Overtime Rules UK
There is no UK statutory right to overtime pay. Whether overtime is paid depends on the employment contract. However, total pay divided by total hours (including overtime) must not fall below National Minimum Wage, and average hours must not exceed 48 per week unless opted out.
Last updated: February 2025
None (contractual only)
Statutory overtime premium
Applies to all hours
NMW floor
48 (unless opted out)
Max weekly hours
What the Law Says
UK law does not require employers to pay a premium for overtime. Overtime terms are governed by the employment contract and any applicable collective agreements. However, the National Minimum Wage Act 1998 requires that average hourly pay across all hours worked meets NMW. The Working Time Regulations 1998 cap average weekly hours at 48 unless the worker has opted out.
Your Obligations as an Employer
- Ensure overtime does not reduce average hourly pay below NMW
- Monitor total working hours to comply with the 48-hour weekly limit
- Pay overtime in accordance with contractual terms
- Include regular overtime in holiday pay calculations (per Bear Scotland v Fulton)
What to Include in Contracts
Specify whether overtime is voluntary or compulsory, the rate of pay (if any), approval requirements, and confirm that overtime will be included in holiday pay calculations where it is sufficiently regular.
View related contract templateCommon Mistakes
- Not including regular overtime in holiday pay calculations
- Requiring unpaid overtime that takes pay below NMW
- Making overtime compulsory without contractual basis
FAQ
Must overtime be included in holiday pay?
Yes, if overtime is sufficiently regular and settled. Following Bear Scotland Ltd v Fulton (2015) and subsequent cases, regular voluntary and compulsory overtime must be included in the calculation of holiday pay for the 4 weeks Regulation 13 leave.
Can an employer force employees to work overtime?
Only if there is a contractual obligation to do so. If the contract states overtime is compulsory and reasonable, the employee may be required to work it. If overtime is described as voluntary, the employer cannot mandate it. Any compulsory overtime must still comply with WTR limits.
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Get Started FreeThis is guidance for UK employers, not legal advice. For complex employment law matters, consult a qualified employment solicitor or ACAS.
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