PEOPLE associated with industrial and commercial undertakings are familiar with the term ‘overtime’.

There are two situations under which employees work beyond regular hours. First, the organisation may require employees to finish the day’s assignment due to unforeseen demands of work, breakdown of machinery and unplanned stoppage of operations, meeting customers’ targets, closing of accounts, and to cover for absent employees. Second, overtime work may be needed because of workers’ incompetence or their wilfully slowing down in order to make extra money through overtime, etc.

The concept of attractive pay for overtime work has existed since the late 19th century, when working hours in industry were rationalised after the agitation by workers of Chicago in May 1886. Their sacrifices, some in terms of lives, culminated in achieving the current standard eight-hour workday.

The Factories Act, 1934, one of the first labour laws introduced by the British in the subcontinent, contained a provision on overtime. Despite frequent application of the concept, the majority of industrial relations practitioners are unaware about the permissible hours of overtime under existing labour laws.

In order to know these, one has to refer to several provisions of the law, which prescribe different limits for various categories of workers and work processes.

There is a lack of awareness of overtime labour rules.

The Factories Act, 1934, has been replaced by the Sindh Factories Act, 2015. The main overtime provision is contained in Section 68(1) of the latter act, which relates to extra pay for such work. It provides that, where a worker in a non-seasonal factory works for more than nine hours in any day or more than 48 hours in any week, he will be entitled to overtime work pay at the rate of twice his ordinary rate of pay. ‘Ordinary rate of pay’ means all remuneration capable of being expressed in terms of money — one’s gross salary.

Rule 101 of the Sindh Factories Rules, 1975 only prescribes the maintenance of an overtime register by an employer, showing overtime hours per day and week and overtime payments to workers, but is deficient when it comes to prescribing the limits of such work. Rule 118 provides that, in the public utility services, a worker performing on a ‘festival’ (public) holiday may be paid at twice the ordinary rate or granted two compensatory holidays — whichever the worker wants. This rule applies if the worker prefers encashment instead of compensatory leave.

Taking advantage of this rule, most progressive companies that have round-the-clock factory operations, in their collective labour agreements with the unions, provide lucrative compensation to workers on public holidays in lieu of granting two compensatory holidays. Provisions relating to maximum number of hours for which a worker may be deputed to work overtime are contained in the Sindh Factories (Adult Exemption) Rules, 1989 for factory workers, and the Sindh Shops and Commercial Establishment Act, 2015 for office staff.

Under the adult exemption rules, there are separate limits on overtime for workers engaged in preparatory work and maintenance work and for those who are engaged in continuous, round-the-clock processes. Workers in the former category may be employed for a maximum of 60 hours in any week, or for 10 hours in any one day.

The permissible weekly limit of normal work is 48 hours, which implies that a worker may be engaged in overtime work for a maximum of 12 hours in a week or two hours per day (Rule 7). In the latter category, the average weekly work hours in any period of three weeks should not exceed 56, suggesting that a worker engaged in continuous processes may do no more than eight hours of overtime work in one week (Rule 8).

However, with few conditions, there is no limit on overtime work in the event of a factory shutdown, which is covered under Rule 6, relating to urgent repairs. In this case, the employer has to send a notice to the chief inspector of factories, informing him of the names of workers employed in urgent repairs and the precise nature of their work.

With regard to office staff, the limit on overtime work has been (surprisingly) reduced from 624 hours to 150 hours (Section 8) in any one year, in the recently promulgated Shops Act, 2015. Even the previously higher limit was insufficient to cope with work exigencies in commercial establishments.

Deputing overtime work is not an incentive or reward but a business need, and the judicious responsibility of an employer. However, at times employers exceed their workers’ overtime limits. To meet business demands then, the maximum limit of overtime for maintenance workers should be increased from the existing 12 to 20 hours a week and for office staff from the previous 624 to 800 hours per annum.

The writer is an industrial relations professional.

Published in Dawn, August 23rd, 2016