By Joanna Knoth, Senior Associate and Gemma Little, Associate
Reasonable Additional Hours vs Overtime
An employee is not be entitled to be paid for any “reasonable additional hours” they work. However, an employee may be entitled to be paid overtime, penalty rates or other allowances for time worked outside of or in addition to their ordinary hours of work if they are covered by an award or enterprise agreement.
Reasonable additional hours – what all employers must know
Before requiring an employee to work additional hours, employers should consider:
- whether it is reasonable to ask employees to work additional hours; and
- any obligations to pay employees overtime, penalty rates or loadings.
The National Employment Standards (NES) provide that an employer cannot request or require:
- a full time employee to work more than 38 hours per week;
- a part time employee to work more than their ordinary hours of work,
unless that request is reasonable.
What is “Reasonable Additional Hours?”
An employee may refuse to work additional hours if the request is not reasonable. To determine whether the additional hours are “reasonable”, it is necessary to consider a range of factors including:
- any risk to employee health and safety from working the additional hours;
- the employee’s personal circumstances, including family responsibilities;
- the needs of the workplace;
- whether the employee receives compensation for working the additional hours, for example, by way of overtime payments, penalty rates or their level of remuneration;
- the notice given by the employer of the request or requirement to work the additional hours;
- the usual patterns of work in the industry, or the part of an industry, in which the employee works; and
- the nature of the employee’s role and the employee’s level of responsibility.
Accordingly, what is “reasonable” will be assessed on a case-by-case basis. However, requiring an employee to work “whatever hours it takes” is not reasonable, even when that employee is paid a base salary that exceeds the statutory minimum: Sagona v R & C Piccoli Investments Pty Ltd  FCCA 875.
Modern awards and enterprise agreements
If an employee is covered by a modern award or an enterprise agreement, they may be entitled to overtime, penalty rates or other allowances for hours work outside of, or in addition to, their ordinary hours.
Employment contracts may also include provisions regarding overtime. Learn more about employment contracts here.
Employers should familiarise themselves with their obligations under any applicable awards or agreements.
If an employer does not wish to pay its employees in strict compliance with a modern award, it should ensure it has appropriate contractual arrangements in place. For example, employment contracts for award covered employees should expressly provide that the employee is paid an all-inclusive amount that can be set off against all monetary entitlements payable under an applicable award, agreement or other industrial instrument.
Employers must ensure they pay employees at least, or more than, the amounts they are entitled to be paid under any applicable award or enterprise agreement. Failure to do so may result in a breach of the Fair Work Act 2009 (Cth) and, among other matters, the imposition of monetary penalties against the employer.
What is the next step if there’s dispute about overtime or reasonable additional hours at your workplace?
If a dispute is brewing in your workplace, the safest next step is to get legal advice. Specialist employment lawyers can assist you to manage employment law issues efficiently and cost effectively.