Editor's message: Meeting short-term business needs through the use of overtime working allows an organisation to take advantage of the flexibility of the workforce without the need to take on additional staff. Employees who work overtime do not have an automatic right to any additional pay; this will depend on the terms of their contract of employment, or on custom and practice. But where there is a premium attached to overtime working, employees can see this as a welcome enhancement to their basic salary.
Employers usually define rates of overtime pay as a multiple of regular or normal pay; other methods include a set hourly rate for overtime or a higher salary to recognise an element of overtime.
Employers should also be aware of the implications of recent case law on the issue of how overtime should be treated in the calculation of holiday pay.
Rachel Sharp, HR practice editor
Updated to include information about proposed changes to the tax treatment of legal expenses, introduced by the Finance Bill.
The Employment Appeal Tribunal (EAT) has held that entirely voluntary overtime should be included in normal remuneration for calculating holiday pay.
Payments for purely voluntary overtime should be included in holiday pay if they are regular enough to constitute "normal pay", the Employment Appeal Tribunal (EAT) has confirmed.
Cases on appeal provides news on key case law developments that are expected.
An employment tribunal has held that ambulance workers' non-guaranteed overtime in respect of "shift overruns" should be included in the calculation of their holiday pay, but that on the facts of this case purely voluntary overtime does not have to be included.
The Employment Appeal Tribunal (EAT) has refused to interfere with the earlier EAT decision limiting the potential for claims for historical non-payment of holiday pay.
XpertHR research looks at annual leave provision, how employers calculate holiday pay, and arrangements for unused holiday entitlement.
What were the most significant employment case law decisions in 2016? Stephen Simpson counts down the 10 most important judgments for employers this year.
An employment tribunal has held that payments for purely voluntary overtime should be included in holiday pay.
We examine overtime working arrangements and pay rates in our 2016 survey.
HR and legal information and guidance relating to overtime pay.