The average Australian worker is putting in unpaid overtime according to new data from global payroll leader ADP – the equivalent of $12,600 per year, based on the annual average salary.
A survey of almost two thousand Australian workers also revealed that levels of unpaid overtime are on the increase compared to the pre-COVID era. Workers are giving away an average of 7.3 unpaid hours per week, up from 5.8 pre-pandemic.
Unpaid overtime includes working during unpaid breaks and starting early or staying late, to regularly putting in several hours of extra work each day for no additional pay.
The increasing numbers of unpaid overtime suggest that potentially thousands of businesses across Australia are breaching changes to Fair Work legislation introduced last year to protect workers.
ADP spokesperson Kylie Baullo said they are concerned that overtime hours worked remain unrecorded and therefore unpaid in Australia.
“There’s a greater impact as workers move in and out of lockdowns with the ever-changing health situation in their state. Fair Work Annualised Wages legislation introduced in March 2020 provides employers with guidelines to help with capturing hours worked,” he went
“The rules require organisations across sixteen award categories to electronically record the hours employees’ work and reconcile them against the Award and paid salary per pay cycle. “We are increasingly finding this legislation has passed many by. There’s both a lack of awareness around the legislation, or around what it means to put into practice.
“Implementing the legislation is a challenge for small and large employers alike. For small businesses, the challenges lie around HR systems, capabilities or capacity. For larger organisations, it’s the complexity of working across such a large workforce, and multiple awards,” he said,
“Depending on what state an employer is based in, the consequences of underpaying employees range from a financial penalty all the way to criminal conviction. The State of Victoria introduced new wage theft laws just last month (July 2021).
“It is now a criminal offence for an employer in Victoria to deliberately underpay employees or dishonestly withhold employee entitlements.
Mr Baullo said he expects other states to follow.
“Never before have employers had to think about the hours being worked by people on annualised salaries. This Fair Work change has introduced that requirement and COVID has made it even more complex. A year on, we know that businesses are still struggling but recognise the need to implement these changes,” he said.
“Our clients see that fairly compensating employees is no longer just the morally right thing to do, but the law.”
Key findings on unpaid overtime in ADP’s People at Work 2021: A Global Workforce View
- More than two thirds (70 per cent) of workers are working unpaid overtime each week.
- Workers are giving away an average of 7.3 unpaid hours per week, up from 5.8 pre-pandemic.
- A quarter of the Australian workforce are putting in more than 11 hours of unpaid overtime per week, a 10 per cent increase from pre-pandemic.
- The proportion of workers in Australia doing an excess of 20 hours per week for free has also risen to seven per cent, up from five per cent the year prior. The majority of workers exceeding 20 hours unpaid overtime weekly were classified as essential workers.
- Employees working from home or in ‘hybrid’ office and home arrangements have been more susceptible to racking up extra hours without remuneration, compared to those who remained on-site throughout lockdown and restrictions.
- Aussies fared slightly better than the global average for unpaid overtime of 9.2 hours per week, according to the findings of the survey of more than 32,000 workers in 17 countries.