As India continues to progress on its development journey, it has seen significant advancements in key sectors such as Information Technology, Infrastructure, Automobile, and Agriculture among others in recent years. The government in the process of uplifting the standard of living of its population has put in place several policies and enactments to promote growth and progress in these industries.
Some jobs require employees to work overtime due to the nature of the work. This is often due to the pressure to meet deadlines or even a lack of resources. In this write-up, the topic we will be discussing is the idea of overtime and its impact on the workforce. The term overtime in simple words can be stated as “any hours worked by an employee exceeding the working hours prescribed under Labour laws”.
Who is entitled to Overtime?
In India, there are several legislations that regulate overtime pay. According to these laws, employees who work more than 48 hours per week are eligible for overtime which is twice the rate of their normal wages. However, there are certain exemptions and exclusions under these laws for certain categories of employees such as government employees, managers, and supervisors. Additionally, employees who are working on a contractual or freelance basis may not be entitled to overtime pay.
In the IT sector, employers are aware of overtime laws and regulations, but some may try to circumvent them by classifying employees as managers or supervisors who are normally exempt from overtime pay. This means that even though these employees may be working more than 48 hours per week, they are not entitled to receive overtime pay because of their job classification. This can be a point of contention between employers and employees, as some employees may feel that they are being taken advantage of or not being fairly compensated for the work that they are doing.
Laws on Overtime
Offices, shops, and factories are all covered by legal overtime requirements for their employees, with some exceptions.
Section 59(1) of the Factories Act of India, 1948 deals with the working hours of workers. As per this section, adult workers in a factory shall not be required or allowed to work more than 9 hours on any day or 48 hours in any week. And if they do, they are entitled to overtime which is twice the rate of their normal wages.
Section 14 of the Minimum Wages Act, 1948 deals with overtime pay. This section states that the employer shall pay the employee for every hour or for part of an hour so worked in excess at the overtime rate fixed under this Act or under any law of the appropriate Government for the time being in force, whichever is higher.
Section 7 and 8 of the Karnataka Shops and Commercial Establishment Act, 1961 also applies to overtime. It says that the working hours for an employee shall not exceed 9 hours a day and 48 hours a week. It also mentions that if employees work overtime, they are entitled to twice the rate of normal wages and the total number of overtime hours worked by an employee should not exceed fifty hours in a period of three continuous months.
What is SPREADOVER?
“SPREADOVER” is a provision that limits the maximum number of hours that employees can be at work, including periods of rest. This provision states that an employee cannot work for more than a certain number of hours per day or per week, and that the employee must be given a certain number of rest breaks throughout their shift. The exact number of hours and rest breaks will vary depending on the jurisdiction and the type of establishment. No employer is allowed to make them work for over 12 hours in Karnataka but again the number of hours can differ from state to state. The objective of this provision is to ensure that employees are not overworked and are given adequate time to rest.
From an employee’s perspective, working overtime increases their earning potential, as it is generally calculated at a higher rate than regular wage which can result in higher earnings for employees. This can help them meet their financial needs and support themselves and their families, especially the ones that are in actual need. Extra hours of work can also help employees gain additional skills and experience, which can be beneficial for their professional advancement as well. However, working overtime can have a variety of effects on employees, depending on the individual, the kind of job they do and their circumstances. Some employees may feel overburdened or stressed due to the added workload and pressure, while others may feel satisfied and occupied by the opportunity to work extra hours.
From an employer’s perspective, overtime can be a cost-effective way to increase productivity and meet deadlines or unexpected spikes in demand for a company’s products or services. It can also help employers to save on labour costs, as they may be able to avoid hiring additional staff. Employers have a legal duty to compensate employees for overtime hours worked and to ensure that employees are not working more than the maximum number of hours allowed by the law. They also have a duty to ensure that their employees are not being overworked to the point of burnout and make efforts to provide employees with sufficient time to rest.
The way ahead
Employers can take several steps to reduce the need for employees to work overtime, including increasing resources and manpower through hiring additional employees, implementing multiple shifts to distribute the workload, and engaging contract workers for specific projects or peak periods. These measures can help improve work-life balance for employees.
It is also of utmost importance to implement these laws across different states and industries, and in some cases, employers may not be fully compliant with overtime laws. Working overtime should be voluntary and not compulsory as it can lead to decreased job satisfaction, exhaustion, and a higher risk of injury or illness of the employees. By considering the steps mentioned above, employers can create a more positive and sustainable work environment for their employees.
-Sourabha Venkatesh, Advocate