This article discusses the issue of unpaid overtime among UK employees and its impact on their health and finances. It highlights the negative consequences of requiring constant overtime, such as reputational damage and staff exploitation.
HR leaders can respond by adjusting seasonal demands, using technology to understand the true cost of overtime, and implementing reward and recognition programs.
We’re going to start this article with three related stats:
First, according to the TUC, that UK employees put in unpaid overtime worth £26 billion last year - that’s seven and a half free working hours per week delivered by 3.5m people.
Second, Achievers found almost eight in 10 UK workers are now taking on more responsibility without being financially rewarded for doing so.
And third, that the number of Google searches for ‘signs of burnout’ have spiked 330% since March 2019.
These interlinking statistics tell a story of UK employees putting in extra time and effort to deliver for their employers, and that doing so is costing their wallet and their health.
Wellbeing and benefits director at Partners&, Steve Herbert, commented to HR Magazine on the current lay of the land that: “It (unpaid overtime) has always been an issue in the British workplace, and remains an expected element of job roles in some sectors.
“This doesn’t make it right of course, but we should accept that this is the norm for millions of workers regardless of legislation protections or contracts of employment.”
Overtime ramifications for organisations
One of the key issues for organisations that regularly require its staff to put in the extra hours is, as Herbert mentioned, a legislative one. Employers who rely on unpaid overtime to meet their own targets can be seen as exploiting its staff.
As it stands, employers don’t legally have to pay overtime - so long as the remuneration for total hours worked (contracted or otherwise) doesn’t fall below the National Minimum Wage.
However, the government’s Retained EU Law bill could further exacerbate the overtime issue with its aim to remove scores of EU regulations surrounding employment rights - including maximum weekly working hours.
There are other reputational and organisational impacts from requiring constant overtime though.
Employers can quickly gain a reputation as being a bad place to work if their staff are regularly pulling 10-12 hour days just to meet their personal workloads. It hints towards a staffing and resource problem, as well as too high expectations from management.
Overworking, as the first three stats from the top of this article suggest, can quickly lead to feelings of burnout. And nothing harms morale, productivity, engagement AND job loyalty quite as fast as working too hard for too long… especially without due recognition or fair financial reward.
What HR can do to help
HR’s role in responding to the overtime problem is multifaceted and has to cover both the demands of the employer and needs of the employees.
Most overtime happens due to a lack of resources, or peaks and troughs in a company’s output. For example, the festive period might require more hours than the summer. HR’s role here can be to assess seasonal demands on employees and adjust working hours accordingly - or indeed hire more temporary staff for those busy periods.
When overtime cannot be avoided, it’s incumbent on people leaders to ensure mechanisms are in place to ensure staff know their efforts are appreciated. Reward and recognition programs, for example, are a great way to sustainably boost engagement levels even through difficult periods.
Pulse surveys and other employee feedback mechanisms are also vital to understand how staff are feeling. If it’s just a couple of employees regularly putting in extra hours, this is a good way to understand if there’s a company-wide overtime issue, or just some staff suffering from striver syndrome (that is, wanting to look good in front of their line managers!).
The right technology is key for organisations to understand the scale of their overtime issue and the ramifications it’s causing. Time tracking, resource management and schedules, employee insights and hiring/firing data all feeds into one meta picture of input and results.
HR’s role is to understand what factors are causing that positive or negative outcome. Too much unpaid overtime as a result of rising demands and time pressures could see staff turnover rates rise. The right HR platforms can then help to calculate what the true cost of that overtime is - not in terms of money saved by not paying wages for extra hours worked, but the cost of lost productivity, worsening staff wellbeing and higher turnover rates.
If unpaid overtime is a growing problem in your organisation, then your next stop should be our System Selection Tool. This free resource will help guide you through the system selection process to uncover the platforms available on the market right now that can meet your current challenges.