Am I being underpaid for overtime worked?

[Robbied196]

Hello to everyone on the forum

I'm pleased to find this forum as I think I am after some fairly straight forward advice and there is a bit of a waiting list to get an appointment at my local Citizens Advice.

I believe I am being underpaid for my overtime hours. This may be a genuine pay roll mistake but I want to be sure of my facts and legal situation before seeing my Managing Director.

I have never signed a contract with the company but the department I work in has a copy of a Employee Handbook which contains around 30 pages. All staff including myself consider this to be our employment contract.

In this contract under the section 'Wages, Salaries and Benefits' it states the following:

Overtime Payments
If full-time employees work in excess of their normal hours in a week (Monday to Friday), then overtime payments will be made at Time and a Third. Part-time employees will only receive these payments when they work more than the full time hours. For hours worked on a Saturday, a payment of Time and a Third will apply and for Sunday, the payment will be Time and Three Quarters. Working statutory holidays will attract a day off in lieu.

I have worked for the company for 14 years. I am payed an hourly rate for a 40 hour week, we are paid every 4 weeks which is 160 hours and 13 pay periods a year. I also work overtime which can vary but recently has been around 6 or 7 hours a week although in the past has been 15 to 18 hours a week. I have to confess I'm not one for going through my payslip with a calculator and I tend to just look at the total which has been paid into my bank.

After receiving my latest P60 and payslip I have discovered I am getting paid my flat hourly rate for overtime and always have been. I've spoken to two other staff members who are also paid hourly and they are paid their overtime at time and a third.

I assume I should also be getting paid time and a third for overtime?

If this is correct should I be entitled for my missing overtime to be paid and backdated?

If so, what length of time can it be backdated too?

Should I be entitled to interest on the missing payments?

I'm sorry there are so many questions on a first post but as you can imagine I am fairly annoyed at my discovery.

Thank you for any advice,
Rob

[leclerc]

Re: Am I being underpaid for overtime worked?

Rob have you spoken to your payroll or completed a payroll query? If you haven't then speak with payroll or Human Resources to clarify the issue.

Once your employer has responded then we may be in a better place to offer advice but you have kind of done things the wrong way round, if that makes sense.

By the way, i would be doing the pounds and pence bit and have once argued on a pay query that I was owed a certain amount of money and had a to and fro for 5 times before the payroll officer realised that I was right.

As an aside, I hope you have kept a record of all hours worked outside of your normal hours.

[mariefab]

Re: Am I being underpaid for overtime worked?

Were you given any information about your overtime pay rate in the first couple of months of this employment?

[Robbied196]

Re: Am I being underpaid for overtime worked?

Rob have you spoken to your payroll or completed a payroll query? If you haven't then speak with payroll or Human Resources to clarify the issue.

Once your employer has responded then we may be in a better place to offer advice but you have kind of done things the wrong way round, if that makes sense.

By the way, i would be doing the pounds and pence bit and have once argued on a pay query that I was owed a certain amount of money and had a to and fro for 5 times before the payroll officer realised that I was right.

As an aside, I hope you have kept a record of all hours worked outside of your normal hours.

Hi leclerc

Its actually quite a small company so I would speak to the Managing Director. I take your point on where I would proceed once he has responded. I'm probably being over cautious in getting my facts straight before speaking to him, but it appears that I should be getting time and a third.

Fortunately, its fairly easy to work out the figures. As we work 2080 hours a year I can times that by my hourly rate and deduct the total from my P60's Total for Year pay. I think I'm right in thinking the amount over, divided by three, will leave me with the amount I am owned in overtime before tax and NI.

[Robbied196]

Re: Am I being underpaid for overtime worked?

Were you given any information about your overtime pay rate in the first couple of months of this employment?

I was referred to the company handbook which details all the rules and regulations including pay and overtime within a couple of weeks of starting employment. What is odd is that its not being picked up before as the managing director sometimes does the payroll. Other people's pay slips list their overtime in a separate column, as we also work 160 hours in 4 weekly pay periods its easy to see if I have 185 hours of working time, 25 hours would be overtime.

[leclerc]

Re: Am I being underpaid for overtime worked?

Hi leclerc

Its actually quite a small company so I would speak to the Managing Director. I take your point on where I would proceed once he has responded. I'm probably being over cautious in getting my facts straight before speaking to him, but it appears that I should be getting time and a third.

Fortunately, its fairly easy to work out the figures. As we work 2080 hours a year I can times that by my hourly rate and deduct the total from my P60's Total for Year pay. I think I'm right in thinking the amount over, divided by three, will leave me with the amount I am owned in overtime before tax and NI.

First of all, ask for a copy of your contract of employment which will explain what you earn and how overtime is added. An employee handbook does not give you as an individual the terms of your contract, merely the terms of your conduct within the company.

The next thing is how long has this underpayment been going on and when did you spot it?
Has any other employees that you know of, queried this pay anomaly?
Do you clock in for overtime/normal work and would the employer have a record of hours worked?
I am not sure the P60 is sufficient evidence although I am sure Eloise will be able to give a more detailed response later on today...

[Eloise01]

Re: Am I being underpaid for overtime worked?

Broadly Leclerc has provided some pretty good advice here, but you need to be cautious and calm! Just because there is a staff handbook hanging around doesn't mean it applies to you or anyone else (or that it is actually the same one from 14 years ago!), and just becaiuse others get overtime pay does not mean that yours and their contractual conditions are the same. It is quite possible for overtime to be paid at single rate, and it is quite possible for people to have different conditions. So it isn't being overly cautious at all in getting your facts straight before talking to the employer - and you should also approach this from a "I think there's an issue here, can I explain it..." rather than "you've underpaid me". Apart from anything else, because people don't have to be paid the same wage, you actually have no evidence that you should be paid an enhanced rate, and there is up to 14 years custom and practice available to say that you aren't! So if a mistake has been made, you want them to be "on your side" about it, not telling you where to go!

And not being funny - but what is equally odd is that it has taken you 14 years to notice it! So the fact that the employer may not have done, if there is anything to spot, isn't entirely amazing! Most things are run by computer now - type in XX boxes and it throws the answer at you. They no more look at stuff than you have - obviously It is also as much your responsibility to check your pay as it is theirs. 14 years is a long time to miss it - especially if it is that easy to calculate!

So make sure of your information and then take it up with the employer in a calm way that won't step on toes. Be aware that if you have been underpaid for 14 years it is highly unlikely that you are ever going to see most of that money - even if they have records going back that far, legally they don't have to pay back that far, and it's likely too costly as well.

See what your employer says and if there isn't an agreement or a satisfactory response then we can advise further - but be aware that "further" will ultimately mean taking legal action against your employer if there is no alternative being agreed.

[Robbied196]

Re: Am I being underpaid for overtime worked?

Thanks for the advice. I'll take the diplomatic approach tomorrow morning and report back. I've just spoken to a couple of staff members who say the 'Employee Handbook' was introduced in 1996 and replaced all existing contracts. No one has a personalised contract in writing. I understand the employee handbook does not necessarily count as a contract. However, it seems strange to specifically state rates of overtime within the handbook. If the 'contract' is a verbal agreement and not in writing what would stop my managing director from saying overtime for me is paid at a flat rate?

I'll report back

[Eloise01]

Re: Am I being underpaid for overtime worked?

That's the problem - absolutely nothing! Legally your employer must provide you with a statement of terms and conditions - should have done a very long time ago. I think it was within 12 weeks of starting back then (memory is fading now though!) and it is now within 2 months of starting. But the problem is that it is legislation without teeth, because it can only be claimed as part of another claim to an employment tribunal. And obviously if you are in an employment tribunal claim situation, then the chances are that you are also without a job or heading that way. Which is not particularly a place you want to be. So lets see what is said, and think about the options if we need to - because there aren't many! So avoiding having to get there would be the ideal.

[Robbied196]

Re: Am I being underpaid for overtime worked?

That's the problem - absolutely nothing! Legally your employer must provide you with a statement of terms and conditions - should have done a very long time ago. I think it was within 12 weeks of starting back then (memory is fading now though!) and it is now within 2 months of starting. But the problem is that it is legislation without teeth, because it can only be claimed as part of another claim to an employment tribunal. And obviously if you are in an employment tribunal claim situation, then the chances are that you are also without a job or heading that way. Which is not particularly a place you want to be. So lets see what is said, and think about the options if we need to - because there aren't many! So avoiding having to get there would be the ideal.

I've spoken with the MD this morning

Apparently, there is an enhanced flat rate or a lower rate plus overtime at time and a third. He thinks I'm on the flat rate and should have had something to sign at the time which he will look for. He may prove to be right although I have no recollection of having signed anything and don't have a copy if I did. The two different rates would explain everything but I'll update if and when anything is found.

[Eloise01]

Re: Am I being underpaid for overtime worked?

Whether you have signed anything or not isn't really a pertinent fact overall - after 14 years! But this explanation would certainly be logical. I don't suppose that you thought to look at the basic pay that others were receiving, to see that they got paid the same basic rate?

[Robbied196]

Re: Am I being underpaid for overtime worked?

Whether you have signed anything or not isn't really a pertinent fact overall - after 14 years! But this explanation would certainly be logical. I don't suppose that you thought to look at the basic pay that others were receiving, to see that they got paid the same basic rate?

Its becoming obvious I'm not going to have a leg to stand on having worked for 14 years on a flat rate. I don't have an issue with the rate, I was more concerned that at first glance it appeared I was being discriminated against by being underpaid.

The enhanced flat rate or a lower rate plus overtime at time and a third are different for each person. It seems you have a choice about which rate you prefer to work at, although I don't remember being offered a choice. Therefore, none of us know how much anyone else is getting paid.

[Eloise01]

Re: Am I being underpaid for overtime worked?

The 14 years doesn't help, no. But what you are describing isn't discrimination either. People are not entitled to be paid the same amount of money as other people. That's a common fallacy. They have the right not to be paid differently when the difference in pay is based on a "protected characteristic" - things like race, gender etc. There is nothing to stop an employer paying every single person at a different rate, whether they do the same job or not. But if you have ben paid at an enhanced flat rate then you have been benefitting from extra pay on every hour you work, whether overtime or not, so that seems a reasonably fair disctinction.