When employees work on holidays, is this considered overtime? The Supreme Court has determined that such work is not overtime and accordingly, overtime premiums are not payable. The case was decided on the definition of "Weekly Standard Working Hours" as amended in March 2018.

What Are Weekly Standard Working Hours? the old position

Prior to the 20th March, it was unclear but generally accepted that he number of hours employees worked per week ("weekly standard working hours") referred to regular working days, and excluded holidays. This meant that where employees had already worked 40 hours in a week, if the next day they worked on was a holiday, they were entitled to overtime pay rather than holiday pay.

What Are Weekly Standard Working Hours? the new position

As part of the recent changes to the Labour Standards Act, the position was clarified, stating that "one week shall mean seven days, including holidays". Where employees have worked 40 hours, the first eight hours of work performed on a holiday is not considered overtime, and is paid at the holiday pay rates only.

Why Does It Matter?

The definition is important when dealing with employees who work on a holiday. Are they entitled to overtime payments (on top of the holiday pay premium rate) or just the holiday pay premium? The difference can have a significant impact on the cost to the business. The different rates are:

The Supreme Court's Decision

The Supreme Court in a recent decision handed down in June 2018 has determined that employees who work eight hours or fewer on a holiday are not entitled to overtime premiums. The first eight hours are paid at holiday pay rates (150%); anything in excess then attracts the overtime premium (200%).

Key Takeaways

Businesses should carefully record and monitor the number of hours employees are working and ensure that for work done in excess of their usual working hours they are paid correctly whether the work attracts holiday pay or overtime pay.