Overtime is the amount of time someone works beyond normal working hours. The term is also used for the pay received for this time. Normal hours may be determined in several ways:
- by custom (what is considered healthy or reasonable by society),
- by practices of a given trade or profession,
- by legislation,
- by agreement between employers and workers or their representatives.
Most national countries have overtime labour laws designed to dissuade or prevent employers from forcing their employees to work excessively long hours (such as the situation in the textile mills in the 1920s). These laws may take into account other considerations than humanitarian concerns, such as preserving the health of workers so that they may continue to be productive, or increasing the overall level of employment in the economy. One common approach to regulating overtime is to require employers to pay workers at a higher hourly rate for overtime work. Companies may choose to pay workers higher overtime pay even if not obliged to do so by law, particularly if they believe that they face a backward bending supply curve of labour.
Overtime pay rates can cause workers to work longer hours than they would at a flat hourly rate. Overtime laws, attitudes toward overtime and hours of work vary greatly from country to country and between various sectors.
In Singapore, employee can claim overtime if they are:
- A non-workman earning up to SGD2,600.
- A workman earning up to SGD4,500.
The overtime rate payable for non-workmen is capped at the salary level of SGD2,600, or an hourly rate of SGD13.60.
For overtime work, employer must pay at least 1.5 times the hourly basic rate of pay. Payment must be made within 14 days after the last day of the salary period.
A non-workman earns SGD2,600 a month and works 2 hours of overtime. The overtime pay is:
SGD13.60 x 1.5 x 2 hours = SGD40.80
Maximum Hours of Work
Employees are not allowed to work more than 12 hours a day.
However, employer can ask employee to work more than 12 hours a day in the following circumstances:
- An accident or threat of accident.
- Work that is essential to the life of the community, national defence or security.
- Urgent work to be done to machinery or plant.
- An interruption of work that was impossible to foresee.
If an employer requires employees to work more than 12 hours a day (up to a maximum of 14 hours), they must apply for an overtime exemption
. An employee can only work up to 72 overtime hours
in a month. But employers can apply for an exemption
if they require employees to work more than the 72 hours of overtime in a month.