When is overtime considered as voluntary or compulsory?
Overtime by definition is when an employee works over and above their contracted hours, this may be for example due to seasonal peaks or to cover absence in the workplace. Recognised overtime rates are more commonly associated with hourly paid workers and there is no obligation to pay enhanced rates of pay for overtime, although may business do this if the overtime is in less sociable hours such as nights or weekends.
ACAS set out some clear guidance on how to classify overtime:
‘Overtime can be compulsory or voluntary. It will depend on the terms and conditions of the contract whether overtime is:
- compulsory and guaranteed
- compulsory but non-guaranteed.
Voluntary overtime is where there is no obligation on an employer to offer overtime and no obligation on the worker to do overtime if it is offered. A worker should not be subject to any detriment for turning down voluntary overtime.
For example: Several workers are absent from work due to sickness. This leaves their employer short-staffed. The employer offers overtime to their colleagues so they continue to meet customer demand. The workers are able to choose whether or not to work the extra hours as there is nothing in their contract to say they must do so.
Guaranteed overtime is overtime that an employer is contractually obliged to offer and a worker is obliged to accept.
For example: An employer knows they need to fulfil an order from a particular customer on the last Sunday of every month. The contracts of employment include that staff will be scheduled to work overtime on this particular day each month and they will be obliged to work it.
Non-guaranteed overtime does not have to be offered by an employer. However, when it is offered, the worker must accept and work it.
For example: An employer knows that their business is likely to be busier at certain times of the year but does not know how much overtime they will need their employees to work. The employer includes in its contracts of employment that, if needed, workers will have to work extra hours during the busy periods.
An employer who wants to rely on either guaranteed or non-guaranteed overtime should clearly set out in the terms and conditions of employment that the overtime is compulsory.
If a worker refuses to work overtime they are obliged to work, the employer may view this as a breach of the contract and a disciplinary matter.’
Should you wish to discuss how your Company deals with overtime and to ensure your contracts reflect this correctly then contact us to speak with one of our HR Experts on 0844 87972886
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