Unpaid overtime: How it’s costing Aussies billions

Australians working unpaid overtime are losing a staggering amount of money.

For many industries, overtime is essential to the productivity of the organisation. While penalty rates for extra work often apply, there are those who don’t get paid for their hard work, namely those on salaries.

According to a report by the Australia Institute, Australians are working an average of six weeks unpaid overtime each year. This is reportedly leaving employees $92 billion short. This equates to over $8,000 a year, or almost $160 a week, said the Australia Institute.

“Our research shows unpaid overtime is a systemic, multibillion-dollar problem which robs Australian workers of time and money,” said research economist at the Australia Institute, Eliza Littleton.

“This is time theft. Unpaid overtime harms our quality of life and reduces our time with family, friends, and those we care for.”

The report noted that employers are claiming 2.5 billion hours of unpaid overtime from Aussie workers per year. This has prompted the Australia Institute to introduce “Go Home on Time Day” on 23 November and opened discussion for the “right to disconnect”, which 84 per cent of workers support.

Ms Littleton commented: “This Go Home on Time Day, our research reveals that unpaid overtime is robbing Australian workers and the economy of over $92 billion per year. This time theft only further exacerbates our current cost-of-living crisis.

“With workers’ share of national income at the lowest point ever, a focus on reducing unpaid overtime would improve quality of life and ease the cost-of-living pressure for millions.”

The Australia Institute report highlighted that incomes are at an all-time low, while company profits are almost at record numbers.

Not only is this leaving workers out of pocket, but there are mental implications, too. According to the report, unpaid overtime left 35 per cent of workers physically exhausted, 32 per cent suffered increased stress, and 31 per cent felt mentally drained.

“The prevalence of overtime suggests that ‘availability creep’ has eroded the boundaries between work and life,” explained Ms Littleton.

“Workplace laws could be updated, including creating a ‘right to disconnect’ as recommended by the Senate select committee into work and care, and as exists for employees of Victoria Police, and Queensland Teachers.”

A report by Professionals Australia discussed what a reasonable expectation of overtime is. The report detailed how each industry differs, and generally, the more senior a role is, the more overtime may be expected.

Staff should refer to their award or agreement for information on overtime and not feel pressured to speak up if the overtime request is unreasonable. The Fair Work Ombudsman states that you are able to turn down overtime when:

• There are health and safety risks involved.
• You have responsibilities outside of work.
• You aren’t being paid in accordance with your agreement or award.
• You aren’t given notice.
• You have discussed the inability to work overtime in the past.

Jack Campbell

Jack is the editor at HR Leader.