Compensation for overtime

• Corporate, Company Law
• Employment Law
• Private Clients
• SME

Working overtime is a common practice in many industries and professions. But how exactly are these additional working hours regulated? What rights do employees have and what obligations must employers fulfil? In this blog post, we clarify the most important questions relating to overtime compensation and provide an overview of the legal basis.

What is overtime?

Overtime is working hours that exceed the contractually agreed or legally prescribed normal working hours. In Switzerland, the maximum working hours are set by law, from which no contractual deviations are permitted in order to protect employees: It is generally 45 hours per week for industrially active companies, office staff, technical employees, sales staff in large companies and 50 hours per week for other employees.

It is important to distinguish between overtime and statutory overtime. Overtime refers to working hours that exceed the maximum working hours permitted by law. Overtime is subject to stricter regulations and is associated with clear compensation obligations.

When must overtime be worked?

In principle, overtime may only be ordered if it is operationally necessary and appears reasonable for the employee. The employee is obliged to work this overtime unless otherwise agreed. However, contractual agreements or regulations may further restrict or regulate the scope and conditions for overtime. However, this must be done in writing.

How is overtime compensated?

There are two main ways in which overtime can be compensated:

Time compensation:

Overtime can be compensated by additional time off. This is the preferred method if both parties agree. As a rule, compensation in time off should be at a ratio of 1:1, unless another arrangement has been agreed.

Financial compensation:

If overtime cannot be compensated by time off, the employer must pay the overtime worked with a supplement of at least 25% of the regular salary. However, this only applies if no other contractual provision has been made that provides for lump-sum compensation for overtime.

It is important to note that many employment contracts contain clauses stipulating that overtime is included in the salary or compensated at a flat rate. However, such clauses must be formulated clearly and comprehensibly in order to be effective.

Special regulations for certain employee groups

There are certain groups of employees for whom special regulations apply:

Managers and executives:

Overtime for managers is often compensated at a flat rate or is considered part of their salary. However, this practice must be clearly regulated in the contract in order to avoid misunderstandings.

Part-time employees:

Part-time employees are also entitled to compensation for overtime if they work more than the contractually agreed working hours.

Shift work and flexible working hours:

In companies with shift work or flexible working time models, there may be special regulations for compensating overtime that meet the requirements of the company and the needs of the employees.

Employers’ rights and obligations

Employers are obliged to properly record employees’ working hours and overtime and to ensure that overtime is compensated in accordance with legal and contractual regulations. It is advisable to set up a transparent system for recording working hours in order to avoid misunderstandings. Employers must also ensure that employees’ workloads do not become excessive in order to rule out health risks.

Rights of employees

Employees have the right to demand that their overtime is correctly recorded and compensated. If the employer does not compensate the overtime worked correctly, employees can assert their claims – in court if necessary. It is therefore important that employees document their working hours accurately and know their rights.

Special case of annual working time model

A so-called annualised working time model can also be agreed in writing. This allows both parties more flexibility with regard to the fluctuating volume of work and compatibility with private interests, as the period of contractual working hours is subject to an annual assessment. It is even possible to carry over any overtime into another calendar year. However, it should be noted that possible overtime must be monitored as part of the employer’s duty of care in order to avoid excessive overtime balances.

Conclusion

Compensation for overtime is clearly regulated in Swiss labour law, but the practice can be complex. To avoid misunderstandings and conflicts, both employers and employees should be fully aware of their rights and obligations. Clear contractual regulations and transparent recording of working hours are key to ensuring that overtime is compensated fairly and correctly.

Through open communication and clear agreements, companies and employees can find a fair balance between operational requirements and the needs of employees – and thus contribute to a positive and productive working environment.