Overtime work – records and payment

Every now and then overtime occurs nearly in any line of business, in any job. How much overtime can employees work in a year? And how is it compensated? Overtime work is governed by the Labour Code, specifically section 78(1)(i) and section 93. Employees may be ordered by the employer to work overtime beyond their normal weekly working hours in exceptional circumstances (for serious operating reasons). Work carried out outside scheduled shifts must not exceed 8 hours in a week and a total of 150 hours in a calendar year. Overtime work beyond the annual overtime limit may only be ordered by the employer by agreement with the employee. The agreement need not be in writing. The employee grants their consent by starting the overtime work. However, also in this case, the overtime work must not exceed 8 hours a week. Therefore, it should be borne in mind that an overtime agreement must not be made for more than 416 hours per year. Extra time worked by an employee outside their scheduled shifts to make up for their weekly working hours is not overtime work (if the employee was granted time off in lieu at their request). An employee who works overtime is entitled to overtime pay of at least 25% of the employee’s average earnings. Compensatory leave (time off in lieu) may be agreed with the employee as an alternative to payment (to the extent of the overtime work). The overtime work for which the employee takes time off in lieu is not included in the overtime limit. Do you need any help or advice about payroll processing? Please do not hesitate to contact us.