Overtime pay
is compensation for hours beyond contractual or statutory working time, typically at premium rates (125–200%) or compensating time off. Rules differ widely: the EU caps average weekly hours at 48, premium levels are national or CBA-set, and several countries exempt senior roles.
The rules that catch employers out
- Premium levels are local: the Gulf mandates 125% (150% nights), many EU CBAs set 125–150%; some states allow time-off-in-lieu instead.
- Working-time limits sit above pay: the EU’s 48-hour average and rest rules apply even where overtime is paid correctly.
- Exemptions are narrower than assumed: ‘manager’ labels do not automatically remove overtime rights — tests are functional.
- Records are mandatory: EU case law requires objective working-time recording; no records means the employee’s account prevails.
FAQ
Can employees waive overtime pay?
Rarely and narrowly: statutory premiums are mostly non-waivable, though some systems allow all-in salaries absorbing a defined overtime volume (Switzerland within limits, executive carve-outs elsewhere). A blanket ‘no overtime paid’ clause is unenforceable in most of Europe and the Gulf.
How is overtime handled for payrolled contractors?
By the employment country’s rules and the applicable CBA — the staffing agreement often sets premiums. Because the provider is the employer, its payroll must capture hours and apply the correct rates; clients approving timesheets should know the thresholds they are approving into.