Why Do Employees Around The World Believe Employers Are Violating Overtime Rules?

It appears that hourly employees around the world believe that their employers are violating overtime rules.  A good number of authorities are weighing in on the issue.

Paul DeCamp, national chair, wage and hour practice, Jackson Lewis LLP, and former Administrator of the U.S. Department of Labor’s Wage and Hour Division says, “Seeing that significant numbers of employees around the world believe their employers have violated overtime laws should serve as a wake-up call to employers everywhere. If your employees perceive that you are out of compliance, you are at risk for a wage-and-hour lawsuit which can be incredibly costly even if you are ultimately found to be in compliance. Investment in wage and hour compliance should be seen as part of risk management for any smart business.”

What drove him to this conclusion?

A new global survey commissioned by The Workforce Institute™ at Kronos Incorporated and conducted by Harris Interactive reveals that a majority of global hourly workers believe their employer has violated laws or rules governing overtime in their region. The Kronos Global Overtime Survey also looks at the frequency of overtime around the world and employee perceptions of how fairly their employers provide overtime.

The Workforce Institute was founded by Kronos Incorporated in 2006 as a think tank to provide research and education on critical workplace issues facing organizations around the globe.  A hallmark of The Workforce Institute’s research is balancing the needs and desires of diverse employee populations with the needs of organizations.

What did the research discover?

Hourly wage workers in Australia, Brazil, Canada, China, France, India, Mexico, the U.K., and the U.S. were represented in the survey.

The vast majority of hourly wage workers around the world said they are at least somewhat aware of the rules and laws governing overtime and compensation where they live (from a high of 96 percent in China to a low of 72 percent in Australia) and a majority in every region except the U.S. also believe their employers had at some point violated overtime rules (88 percent high in China to 47 percent low in the U.S.).

Overtime work is very commonplace around the world. In all regions surveyed except France, more than half of hourly wage workers said their employer offered them the opportunity to work overtime hours (defined as more than their regularly scheduled work hours at either a higher rate of pay or in return for paid time off):

• 82 percent in India;
• 80 percent in China;
• 79 percent in the U.K.;
• 77 percent in Brazil;
• 71 percent in Mexico;
• 61 percent in the U.S.;
• 54 percent in Australia; and
• 52 percent in Canada.

Thirty-nine percent of hourly wage workers in France were offered the opportunity to work overtime.

The survey also found that high numbers of hourly wage workers around the world are actually required by their employer to work overtime: 

• more than half in India (68 percent),
• China (67 percent), and
• the U.K. (58 percent).

There were significant numbers in other regions as well:

• 37 percent in Australia,
• 35 percent in France,
• 33 percent in Brazil,
• 26 percent in the U.S.,
• 24 percent in Mexico, and
• 20 percent in Canada.

The opportunity to work additional hours for a higher rate of pay or additional paid time off was very appealing to employees around the world. The majority of workers in every region surveyed said that they were happy with the amount of overtime hours they worked or wished they could work more:

• 92 percent in Brazil, Canada, and the U.S.;
• 91 percent in Australia;
• 90 percent in the U.K. and Mexico;
• 88 percent in France;
• 85 percent in India; and
• 61 percent in China.

According to Joyce Maroney, director of The Workforce Institute, Kronos, “Our survey looked at employee perceptions, but regardless of the actual state of affairs, if employees perceive that their employer is out of compliance, that employer is at risk. A key way for an organization to protect itself from wage and hour lawsuits is to have an automated way to keep track of time worked. Many organizations are also using “attestation” technology whereby employees attest to the accuracy of their timecard information at the end of every day or pay period. Ensuring that employees get paid accurately is in everyone’s best interests and an automated solution is a critical tool in making this happen.”

It appears employees are showing up for overtime work but their punch cards may or may not reflect actual hours worked. I agree with Paul DeCamp. This is an issue that could easily result in costly litigation.  Overtime is also an indication that businesses are poorly staffed and managed.