ACAS have published new guidance relating to overtime, which covers five key areas summarised below.
Is overtime compulsory or voluntary?
The Guidance covers, and gives examples, of the following types of overtime:
a) Voluntary Overtime
This is where there is no obligation upon an employer to offer overtime, and no corresponding obligation upon the worker to accept it if offered.
b) Guaranteed Overtime
This is where an employer is under a contractual obligation to offer overtime to the worker, who in turn must accept it.
c) Non-Guaranteed Overtime
This is where there is no contractual obligation for overtime to be offered by the employer, but if it is offered then the worker must accept it.
Is there a limit to how much overtime can be worked?
The guidance covers the Working Time Regulations 1998, which sets out the statutory limits on how much overtime is worked, as follows:
a) must not work more than 48 hours per week on average, though a worker may choose to "opt-out"
b) must be allowed at one day off each week or two days off in a fortnight
c) should have 11 hours uninterrupted rest in a 24 hour period
d) is given at least a 20 minute break if their shift lasts more than six hour
The guidance notes that there are some limited exceptions to the above, depending on the work that is being carried out.
The situation differs if the worker is below 18, as they cannot sign any “opt-out” agreement, must have two days off per week, and cannot work over 8 hours a day or 40 hours a week total.
The guidance expressly states that “there is no legal right to receive an additional payment or be paid at a higher rate for any overtime worked”. However, some employers do offer increased rates of pay in order to incentivise employees, this should be clearly set out in terms and conditions or contracts of employment.
It may be that employers offer time off in lieu to employees instead of additional pay, which allows them to take off time from work in addition to their usual entitlement to annual leave.
Overtime and part-time workers
Employers should ensure that part-time workers engaging in overtime are not treated any less favourably than full time workers. If increased rates of pay for overtime are offered to full time workers then the same should also be given to any part-time workers, provided they have worked the same amount of hours as their full time counterpart. If the part-time worker does not meet this threshold, then there is no obligation to pay the same enhanced rate of pay for overtime.
Overtime and the impact upon holiday calculations
The guidance states as follows:
“Recent court decisions have indicated that all overtime worked should be included when calculating a worker's statutory holiday pay entitlement. The only exception to this is overtime that is worked on a genuinely occasional and infrequent basis.”
A link to the full guidance is available here.
If you have any queries about overtime, please contact our Employment Team who will be happy to help.