Do you have to pay staff for doing "a bit extra" before or after work?

That was the question the employment tribunal had to answer in Fitz v Holland and Barrett.

Mr Fitz worked under a series of fixed hours contracts. He became a supervisor and was expected to provide cover when the store manager was absent. This meant he had to open and close the store and do other tasks such as sweeping up and cleaning the fridge. He was not paid for this additional time which fell outside of his contractual hours.

His contract did not say that he was expected to work overtime or specify whether or not he would be paid for working additional hours.  However, the company did operate a paid overtime scheme which reimbursed staff for working additional hours.

Following a dispute about his hours and holiday pay, Mr Fitz resigned and complained to the tribunal that he had suffered unlawful deductions from his wages because he had not been paid for the 200 or so hours he had undertaken when providing cover for his supervisor. He said this amounted to almost £1,780.

The tribunal agreed, but only awarded him £1,019.

It said that a term would be implied into his contract that he was entitled to be paid for the additional time it took to open and shut the store - but not for the other jobs Mr Fitz claimed he had also undertaken after hours because these could have been done during the working day. 

It also said that Mr Fitz couldn't recover underpayments going back further than two years.

Tips 

1.  If you expect your staff to work additional hours, you should expressly set this out in their contracts of employment and make it clear whether overtime will be paid or unpaid. If it is paid, set out the rates that apply.
2. If you don't intend to pay your staff for undertaking overtime, make sure that their rates of pay exceed the National Minimum Wage and that staff receive the appropriate rates of pay for the hours they work. Penalties for breaching the NMW rates are huge (up to £20,000 per worker) and HMRC can go back up to six years to recover underpayments.

Need more information?

Our employment expert Alan Lewis can help you draft appropriate contracts and put in place systems to make sure you comply with the NMW.

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