Overtime and extra work hours are not the same thing and must be strictly distinguished. Issues surrounding overtime and extra work hours are a constant source of concern for the courts. In the following article, some principles on overtime and extra work hours are called to mind.
What is overtime?
Overtime is the positive difference in time between the hours worked and the normal working hours. According to Art. 321c para. 1 SCO, the “normal” working time is determined by agreement, practice, collective or standard employment contract. If, for example, a 40-hour workload has been agreed in an employment contract and the employee has performed 42 hours of (operationally necessary) work, two hours of overtime have been worked. It should be noted that the weekly working time is not necessarily the mandatory reference value. It is left to the parties to determine this. For example, a daily workload of 8 hours can also be agreed. It is also possible for part-time employees to work overtime, namely if they work beyond the agreed part-time workload. If, for example, it is agreed that a female cashier is to work 14 hours a week and she subsequently works 16 hours, she has worked two hours of overtime. If there is no evidence of contractual or normal working hours, there can be no overtime. If, for example, a contract states that an employee is to work “at least” 40 hours and he subsequently works 41 hours in one week, no overtime has been worked.
Obligation to perform
Art. 321c para. 1 SCO stipulates the employee’s obligation to work overtime, in addition to the agreed or usual working hours or those stipulated in a collective or standard employment contract, if it is necessary and reasonable for the employee. Overtime is necessary if it has been authorised by the employer. Necessity is also assumed if the employee works overtime on his own initiative and reports this to the employer. In this case, in the absence of the employer’s intervention, it can be assumed that the employer approves the overtime as necessary for the company. If the employee fails to notify the employer of the overtime worked on his own initiative, he risks losing his entitlement. The employee’s claim is only protected if there are indications that the employer was aware of the employee working overtime even without direct notification. Thus, if an employee accumulates overtime over a period of months or even over a period of years without authorisation from the employer and then claims this (often upon termination of employment), the employee only has a chance of success if he can prove that the employer knew or, according to the circumstances, should have known about these overtime hours.
Overtime work, however, not only requires necessity in the employer’s company, but also reasonableness on the part of the employee. In particular, the extent to which the employee’s private and family life is disturbed by the overtime work must be considered, as well as whether the employer’s economic interests could easily have been satisfied by means other than overtime work.
Compensation through time off
Art. 321c para. 2 SCO stipulates that, with the consent of the employee, the employer may, within a reasonable period of time, compensate overtime work with time off of at least the same duration. Accordingly, the employee’s consent is required for the compensation of overtime with time off. The agreement to compensate for overtime with time off is not subject to any formal requirements and therefore can also be implied or stipulated in advance in the employment contract. This principle should be recalled, especially in connection with leave of absence. One often encounters formulations according to which holidays and any overtime are deemed to be compensated with time off. With regard to overtime, however, this is only possible with the employee’s consent. This consent may already be included in the employment contract.
The law does not specify what is meant by a reasonable period of time. In this respect, an analogy to the regulation in the Employment Act on overtime comes to mind, whereby compensation should take place within 14 weeks, at the latest within one year, by means of time off of equal duration. Unless the parties have agreed otherwise, the compensation for overtime is to be made without premium at a ratio of 1:1 to the overtime work performed.
Overtime premium
If the overtime work is not compensated by time off and if nothing else has been agreed in writing, the employer must pay wages for the overtime work, which are calculated according to the normal wage plus a premium of at least one quarter (Art. 321c para. 3 SCO). The normal wage also includes the share of the 13th month’s wage (but not the voluntary bonus) as well as the regular allowances.
Articles 321c para. 2 and 3 SCO are discretionary in nature. This means that the parties may deviate from these provisions by written agreement. The parties may, for example, provide that the remuneration for overtime is included in the wage, or that overtime is paid without a premium, or that overtime worked is compensated by an extra week of holiday, etc. The parties may, however, waive such a premium in advance. However, a waiver of such a premium in advance must be related to the activity provided for in the contract and may not concern an additional, different type of employment, even less so if it entails considerable extra work.
Waiver of overtime worked?
According to the case law of the Federal Supreme Court, a waiver by the employee of the remuneration for overtime worked, which was not previously waived pursuant to Art. 321c para. 3 SCO and is thus owed, is generally inadmissible in the context of Art. 341 para. 1 SCO.
However, according to the Federal Supreme Court, Art. 341 para. 1 SCO does not apply if the employee waives wages for overtime already worked in return for appropriate consideration, e.g. in the context of a settlement, provided this is based on mutual concession and leads to appropriate compensation.
Enforceability of overtime
According to academic research and legal precedent, an employee who claims overtime must prove that he actually worked these hours and that they were necessary for operational reasons. Practice shows that, because of this apportionment of the burden of proof, overtime lawsuits often end in favour of the claiming employee. Therefore, the question arises as to whether the burden of proof should not be reversed if the employer has not or only insufficiently fulfilled his obligation to document the daily and weekly working hours according to Art. 73 para. 1 lit. c ArGV 1 or if in a lawsuit he refuses to submit the documents that are actually available.
According to the case law of the Federal Supreme Court, however, such a reversal of the burden of proof can only be assumed in exceptional cases of actual obstruction of evidence, e.g. if an employer intentionally destroys the working time documents that are actually available in view of a pending civil case, in order to make it impossible for the employee to prove that he worked overtime. Easing of the burden of proof, however, is conceivable and frequent. For example, an employee’s own record of working hours or working time control can be admitted as evidence. If the judge assumes that overtime has been worked in principle, he will then estimate the quantity of overtime worked with some degree of probability within the framework of Art. 42 para. 2 SCO. However, cantonal court practice does not seem to be uniform in this regard. There are judges who only admit such lists prepared by the employee himself as evidence if they have been continuously updated during the employment relationship. In contrast, lists that are only drawn up in connection with the lawsuit have very little probative value.
What are extra work hours?
A distinction must be made between overtime and extra work hours. Extra work hours are understood to be the exceeding of the maximum working hours as provided for in the Employment Act (ArG). The maximum weekly working time for employees in industrial enterprises as well as for office staff, technical and “other” employees, including sales staff in large retail enterprises, is 45 hours (Art. 9 para. 1 lit. a ArG). For all “other” employees the maximum working time is 50 hours (Art. 9 para. 1 lit. b ArG). This latter provision mainly covers workers who carry out manual activities outside industry (“commercial craftsmen”).
Thus, for example, if an office employee whose employment contract provides for a 40-hour workload per week works 47 hours per week, technically speaking he works five hours of overtime and two extra work hours. This differentiation makes sense because the parties may make an agreement that deviates from the law with regard to overtime (e.g. that the overtime is included in the wage); the regulation regarding extra work hours, on the other hand, is mandatory. This means that extra work hours must either be compensated or paid for with a premium, even if something else had been agreed in a contract. In the example shown, 2 hours must be compensated or paid with a premium in any case (if the extra work hours exceed 60 hours per year; see below).
It should be noted, however, that the maximum working time provisions of the Employment Act do not apply to “senior executives”. According to an easy-to-remember formula, a “higher managerial employee” in the employer’s sense is an employee at the “levers of power”; he must therefore exercise employer-like functions (e.g. independent hiring and firing of staff).
Exceeding the maximum working time
The maximum weekly working time may only be exceeded under certain conditions, which under employment law then give rise to overtime. This is the case when work is urgent or there is extraordinary pressure of work, when inventories are being taken, accounts are being closed and when liquidation work is being done to prevent or eliminate operational disruptions, insofar as the employer cannot be expected to take other precautions (Art. 12 para. 1 ArG).
The maximum number of overtime hours allowed per calendar year is linked to the weekly working hours of Art. 9 para. 1 ArG: 140 hours for employees with a maximum weekly working time of 50 hours and 170 hours for employees with a maximum weekly working time of 45 hours (Art. 12 para. 2 ArG).
Compensation and premium
Extra work hours must be paid with a wage premium of 25%, whereby, as in the calculation of the overtime premium, a share of the 13th month’s wage and regular allowances must also be taken into account. However, employees for whom the maximum working time is 45 hours per week are only compensated with this premium if the extra work hours exceed 60 hours in a calendar year (Art. 13 para. 1 ArG). This means that no premium is due for the first 60 hours of extra work hours.
Instead of paying out extra work hours, it is permissible, with the agreement of the employee, to compensate for this, within a reasonable period of time, with time off of equal duration (Art. 13 para. 2 ArG). However, a complete contractual exclusion — i.e. neither premium nor compensation — is not possible because the legal regulation, as mentioned above, is of a mandatory nature.
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