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How is overtime pay calculated?
How is overtime pay calculated?
Overtime work is considered the performance of an employee’s job function beyond the established working hours of the day, based on the employer’s order (instruction, decision) and with the employee’s consent. Expert Kamala Yusifova, in her statement, clarifies issues related to employees’ rights and payments during overtime hours.
According to Article 101 of the Labor Code, overtime work is permitted only in the following exceptional cases:
a) to ensure the defense of the state, as well as to carry out urgent work required to prevent or eliminate the consequences of natural disasters or industrial accidents;
b) to perform necessary work to eliminate the consequences of unforeseen events that have caused disruptions in the operation of water, gas, and electricity supply, heating, sewage, communications, and other public utilities;
c) when work that has been started cannot be completed by the end of the working day due to technical production conditions, and interruption of such work may cause unavoidable spoilage or damage to equipment or goods, making completion of the work essential;
ç) when repair or restoration of malfunctioning mechanisms or installations, whose breakdown has caused the suspension of the work of most employees, is required;
d) when it is not possible to suspend work due to the absence of a replacement worker.
The employer is obliged to take all necessary measures to ensure the timely elimination of the reasons that lead to overtime work, as well as to replace an absent employee with another worker.
According to Article 99 of the Labor Code, employees working in particularly heavy and hazardous industries, as well as in the cases mentioned above, cannot be engaged in overtime work. In such industries, the total duration of overtime work during a workday (shift) cannot exceed 2 hours. No employee may be engaged in more than 4 hours of overtime during two consecutive working days, and no more than 2 hours in workplaces with heavy and hazardous working conditions.
Can overtime work be compensated with an additional rest day?
According to Article 165 of the Labor Code, overtime work cannot be compensated with an additional rest day. Payment for overtime work is calculated as follows:
Under a time-based pay system – at a rate not less than double the hourly tariff (official) rate of pay;
Under a piece-rate pay system – in addition to the full piece-rate pay, an extra payment not less than the hourly tariff (official) rate of a time-based worker of the corresponding grade (qualification).
The employment contract or collective agreement may provide for a higher rate of additional pay for overtime work.
Example: An employee worked a total of 8 hours of overtime in one month. The employee’s tariff (official) salary is 1,000 manats. In August, the employee worked the full month, and according to the production calendar, the norm for August is 168 hours. The calculation will be as follows:
First, let us calculate the hourly wage:
1,000 ÷ 168 = 5.95 manats.
(5.95 × 8) × 2 = 95.2 manats.
1,000 + 95.2 = 1,095.2 manats.
Thus, the employee’s gross salary for August will be 1,095.2 manats.
Overtime work is considered the performance of an employee’s job function beyond the established working hours of the day, based on the employer’s order (instruction, decision) and with the employee’s consent. Expert Kamala Yusifova, in her statement, clarifies issues related to employees’ rights and payments during overtime hours.
According to Article 101 of the Labor Code, overtime work is permitted only in the following exceptional cases:
a) to ensure the defense of the state, as well as to carry out urgent work required to prevent or eliminate the consequences of natural disasters or industrial accidents;
b) to perform necessary work to eliminate the consequences of unforeseen events that have caused disruptions in the operation of water, gas, and electricity supply, heating, sewage, communications, and other public utilities;
c) when work that has been started cannot be completed by the end of the working day due to technical production conditions, and interruption of such work may cause unavoidable spoilage or damage to equipment or goods, making completion of the work essential;
ç) when repair or restoration of malfunctioning mechanisms or installations, whose breakdown has caused the suspension of the work of most employees, is required;
d) when it is not possible to suspend work due to the absence of a replacement worker.
The employer is obliged to take all necessary measures to ensure the timely elimination of the reasons that lead to overtime work, as well as to replace an absent employee with another worker.
According to Article 99 of the Labor Code, employees working in particularly heavy and hazardous industries, as well as in the cases mentioned above, cannot be engaged in overtime work. In such industries, the total duration of overtime work during a workday (shift) cannot exceed 2 hours. No employee may be engaged in more than 4 hours of overtime during two consecutive working days, and no more than 2 hours in workplaces with heavy and hazardous working conditions.
Can overtime work be compensated with an additional rest day?
According to Article 165 of the Labor Code, overtime work cannot be compensated with an additional rest day. Payment for overtime work is calculated as follows:
Under a time-based pay system – at a rate not less than double the hourly tariff (official) rate of pay;
Under a piece-rate pay system – in addition to the full piece-rate pay, an extra payment not less than the hourly tariff (official) rate of a time-based worker of the corresponding grade (qualification).
The employment contract or collective agreement may provide for a higher rate of additional pay for overtime work.
Example: An employee worked a total of 8 hours of overtime in one month. The employee’s tariff (official) salary is 1,000 manats. In August, the employee worked the full month, and according to the production calendar, the norm for August is 168 hours. The calculation will be as follows:
First, let us calculate the hourly wage:
1,000 ÷ 168 = 5.95 manats.
(5.95 × 8) × 2 = 95.2 manats.
1,000 + 95.2 = 1,095.2 manats.
Thus, the employee’s gross salary for August will be 1,095.2 manats.