COMMENT
HOURS TO SUIT
14 JUNE 2019
The FM sector is notorious for its long hours. Here, Tina Chander,
Partner and Head of the Employment team at Wright Hassall
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The issue of working late can be a sensitive one
within many businesses, as the line between
flexibility and unhealthy overtime becomes
increasingly blurred.
Most people don’t mind staying late occasionally if
there’s a vital piece of deadline-dependent work that
still needs to be completed, and this is commonplace
for organisations associated with the management
of facilities.
However, when unpaid overtime is pushed to
unreasonable lengths and negatively impacts
personal time and sociable hours, it can have
significant implications on employees’ work-life
balance.
Not only this, but excessive unpaid overtime can
have serious consequences for employers, as the
boundaries are pushed to unacceptable lengths,
resulting in a potential breach of contract.
THE CULTURE OF OVERTIME
Usually, the term overtime means staying behind
past the contracted hours and working late into
the evening. However, this isn’t always the case, as
employees who work through their lunchbreak or
get to work much earlier than their colleagues are
also classed as working overtime.
One of the biggest reasons for salaried sta€
working later hours is workplace culture, where
people feel they cannot leave the o€ ice on time for
fear of criticism. This can lead to people becoming
overworked without the correct pay, which can lead
to various personal and professional issues.
It is important for employers to ensure their
contracts give all sta€ clear guidance on what is
expected with regards their working hours – clear
parameters will prevent any grey areas becoming
more complicated issues later down the line.
JUNIOR AND SENIOR STAFF
Understandably, senior sta€ , who are on higher
salaries, should expect some additional hours just to
get the job done. The bigger issue comes when more
junior members of sta€ are working late, as there is a
risk they could end up working below the minimum
wage.
Under the working time directive, UK workers
cannot work more than an average of 48 hours a
week unless they sign an opt-out, and most workers
are entitled to a rest break of at least 20 minutes if
they work longer than six hours per day.
While employers do not have to pay for overtime,
an employee’s average pay for the total hours
worked must not fall below the National Minimum
Wage (NMW).
Failing to protect junior workers can result in
serious legal issues, which can be damaging for the
reputation of a company if looking to recruit new
sta€ in the future.
HOLIDAY PAY
The case of Lock v British Gas
was initially decided in 2014,
and the principles it
established have since
been built upon.
The decision is that
workers are entitled
to receive ‘normal
remuneration’
during periods of
annual leave to
prevent workers
from not taking
annual leave out
of fear they will only
receive basic pay instead of
potential separate allowances.
The current position states that
a number of payments should be included
in holiday pay provided they are paid regularly or
repeatedly over a su€ icient period.
These areas include; commission payments,
incentive bonuses, overtime pay, payments based
on personal and professional status, productivity/
performance bonuses, shi‚ allowances and
premiums, standby payments and travel allowances
or allowances that can be treated as taxable.
POSSIBLE PENALTIES
If an employee is continually working over their
contractual hours and their average pay falls below
the National Minimum Wage, the employer can
face both civil and criminal penalties, once it’s been
reported by the worker.
Under civil penalties, the employer will be issued
with a Notice of Underpayment and they will be
required to pay a financial penalty to the Secretary
of State within 28 days, alternatively they may be
ordered to ‘self-correct’.
The current financial penalty is 200 per cent of the
total underpayment up to a maximum of £20,000
(reduced by 50 per cent if it is complied with within
14 days of service).
Those employers who fail to pay in accordance
with NMW can be named by HMRC, meaning
o€ ending businesses will be ‘named and shamed’,
which can negatively impact ongoing operations and
relationships.
Where an employer refuses to engage with the
civil enforcement procedures, criminal penalties can
be applied, which could include the conviction of a
summary o€ ence and the fine in respect of this can
be unlimited.
COMPREHENSIVE CONTRACTS
It is important that all employment contracts
address overtime and reflect your policy.
It may be necessary to specify that sta€ will
sometimes have to work unpaid overtime, but you
must not ask them to work for more than 48 hours a
week for legal reasons.
Your contract may also explain that sta€ can
claim time o€ in lieu (TOIL) for some
overtime, such as working evenings
or weekends, but it’s up to
businesses to ensure their
employment contracts are
legal and reflect their own
needs and expectations.
Therefore, it is
important that
businesses who pay
their employees
for overtime hours
continually review their
own contracts and policies,
reflecting this in the amount
employees receive as holiday
It is important for
employers to ensure their
contracts give all staff clear
guidance on what is expected
with regards their working
pay.
For those who are unsure, it is important
hours.”
to seek professional guidance during the dra‚ ing
of contracts as this can prevent any serious issues
occurring later down the line.
FINDING THE PERFECT BALANCE…
While overtime has become an accepted part
of modern business, with employees favouring
increased flexibility over rigid and structured days,
there still needs to be a fair balance between normal
and excessive working.
Most businesses will accept that busier periods
require staying later so that work is completed, but
when this overtime consumes entire evenings or
limits time with friends and family then it can quickly
become a much more serious issue.
For businesses, it is crucial that policies and
contracts are routinely reviewed and updated to
allow for overtime and make clear distinctions
between what additional time will be covered and
what won’t be.
ADVICE & OPINION