Overtime quickly leads to disputes - by month-end, often nobody remembers exactly who worked how much. Clean, ongoing recording prevents disagreements and is part of time tracking anyway. Here's how to make it easy.
Overtime is the working time that exceeds the regular working hours agreed in the employment contract, a works agreement or the collective bargaining agreement. This is to be distinguished from additional work (Mehrarbeit) - a term often used for exceeding the statutory maximum working hours under the Arbeitszeitgesetz (Working Hours Act). In everyday use, the two terms are often used interchangeably, usually meaning time worked beyond the agreed hours.
Important for the calculation: Breaks don't count as working time and therefore not as overtime either. What matters is the working time actually performed, not mere presence at the workplace.
Recording overtime is part of the general Time-tracking obligation: the start, end and duration of daily working time must be recorded - including any time that goes beyond the agreed hours.
There's also the practical benefit: if a dispute later arises over the number and compensation of overtime hours, the party asserting the claim usually has to provide proof. Without verifiable records, it quickly becomes one person's word against another's. Gap-free documentation creates clarity for both sides.
In many businesses, plus and minus hours are recorded in a working-time account recorded. Anyone who works more than agreed accumulates plus hours; anyone who leaves earlier or works less builds up minus hours. With flexitime models, smaller fluctuations balance out by themselves over time.
What matters is to keep the Balance always in view in view. Otherwise, large plus or minus balances build up unnoticed that can hardly be fairly cleared by year's end. The more transparent the current status is for both sides, the less often there are nasty surprises.
There are two common ways to offset overtime: time off in lieu (the hours are later taken off as time off) or Compensation (the hours are paid out, sometimes with a premium). Which option applies depends on the respective employment contract, a works agreement or the collective bargaining agreement.
Some contracts contain clauses stating that a certain number of overtime hours are considered covered by the salary. Such provisions are not always valid - if in doubt, it's worth checking the contract and, if necessary, seeking expert advice. Regardless of the approach chosen, one thing holds true: only what is properly recorded can be correctly balanced out.
Most problems don't arise from ill will, but from sloppy recording. Particularly common are:
Just need a simple template to record the hours for now? Here's a free timesheet as PDF & Excel.
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