01332 340 211

Overtime: what policy have you got in place?

Find a person by name
Or choose a department

 

Many businesses that use overtime on a regular basis write overtime terms and conditions and rates of pay into employee’s contracts, leaving little confusion or misunderstanding. However, if there is a provision for overtime in your employee’s contract, but no specific rate mentioned, you will still be expected to pay a reasonable rate for overtime.

This sentiment was confirmed in a recent case heard by the Court of Appeal in which it concluded that the law will imply a reasonable rate is to be paid for overtime if no set rate has been previously agreed.

The case in question was Driver v Air India Ltd. Mr Driver’s contract of employment stated that terms relating to overtime payments were “set out in notices and circulars issued by Air India from time to time”.

However, Air India had never issued any notices or circulars about overtime. They, therefore, argued that the employee had no contractual right to payment for overtime.

In response to this, Mr. Driver argued that, as he had been paid for previous overtime he should continue to receive overtime pay at the same rate.

The Court of Appeal found that Mr Driver’s contract clearly intended that he would be paid for overtime. The fact that no rate was ever specified did not mean that payment was not owed. The general position will be that where the amount of a contractual payment is not specified, the law will imply a reasonable sum.

This recent case demonstrates the importance of having clear terms and conditions, especially relating to overtime and rates of pay, set out in your employees’ contracts. This will reduce the risk of uncertainty and claims for you. You should regularly review your terms and conditions to ensure they reflect your working practices.

Are your terms and conditions, employee handbook and HR policies and procedures all up to date?

Would your business benefit from:

  • Practical advice, as soon as you need it, from a dedicated employment solicitor?
  • Ease of payment with a low, budgetable, fixed monthly cost?
  • Online Access to the latest, compliant, documentation you need?
  • Step by step guidance and support from an award winning Law Firm?

With our fixed cost, insurance backed packages starting from only £70 per month, our clients know exactly how much they will spend.

For more details call 0845 222 0417 to discuss your requirements.

 

< Back
All News >
SEE MORE

Contact us

x

Name (required)

Phone Number (required)

Your Email (required)

Subject

Message

Derby Head Office:
St. Michael’s Court
St. Michael’s Lane
Derby
DE1 3HQ
Tel: 01332 340 211
Fax: 01332 207 601
DX: 729320 Derby 24

Ashbourne:
54, St. John Street
Ashbourne
Derbyshire
DE6 1GH
Tel: 01335 342 208
Fax: 01335 342 010
DX: 26834 Ashbourne

Opening Times:
Our offices are open Monday to
Friday between 8:00am & 6:00pm

Contact us

x