Overtime can be a hot topic

Rules and compensation for overtime

There are no specific statutory rules on overtime. However, the Working Hours Act sets limits on maximum working hours per day and entitlements to breaks and rest periods. In short, an employee may work a maximum of 12 hours per shift and no more than 60 hours per week. Employees do not automatically have the right to be paid for overtime. In certain roles, often at higher organizational levels, overtime is included in the agreed salary.

In most cases, the employment contract or collective labor agreement (CLA) stipulates that overtime is compensated. This can be through additional pay for overtime hours, but it is also possible for employees to accrue extra vacation hours. Employers may only require employees to work overtime if agreements have been made in the employment contract, a staff handbook, the CLA, or if it is deemed reasonable. If an employee voluntarily works extra hours without being asked, being an employer you are not always obliged to treat this as overtime. However, it is advisable to monitor this and to keep proper records of overtime.

Time-for-time

In a recent case (ECLI:NL:RBOBR:2024:3871, Rechtbank Oost-Brabant, 10458093), an employer paid a high price for failing to register overtime. An employee had been working at a holiday park since 2015. The Recreation CLA applied to the employment contract. Under this CLA, overtime is converted into “time-for-time,” allowing employees to take the accrued hours as time off later, rather than receiving them as extra pay. Additionally, the employer was obligated under the CLA to record plus and minus hours and to notify the employee monthly of their overtime balance.

The employee argued that for years he had worked dozens of overtime hours that were never converted into time-for-time by the employer. As a result, he claimed nearly €5,600 in unpaid overtime. The employer, however, maintained that the employee, considering his role, was responsible for maintaining a proper time registration for himself and his colleagues. The employer also argued that overtime only occurred during a few summer periods and that the employee worked fewer hours than agreed in the other months.

The court ruled that it was clear the employee had worked more hours than agreed during the high season and that the CLA’s system applied. Based on this, it was the employer’s responsibility to maintain accurate time records. Moreover, the employer was aware that the employee was working overtime and should have followed up with the employee.

More information

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