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Overtime is any time put in at a job beyond the standard full-time work week, which in the United States is typically 40 hours. Common reasons to work overtime include labor shortages, unexpected demand, employee training and extended seasonal hours. Some companies use overtime pay — often one and a half times an employee’s normal salary — as an incentive to employees who work overtime or during national holidays and exceptionally busy periods.
One of the most common reasons for employees to work overtime is a labor shortage within the company. This can be a result of other employees missing time because of illness, childbirth or vacation, or because the company cannot afford to hire enough labor to complete all of the work to be done. Salaried employees are often forced to work unpaid overtime because of corporate downsizing and other cost-cutting measures. Some salaried employees report routinely working an extra 20 hours or more a week without overtime compensation.
Another reason employees are asked to work overtime is to deal with unexpected retail or manufacturing demand. If consumer purchases exceed sales forecasts, manufactures may increase production shifts to fill demand. This can have a cascading effect through globalized industries that rely on parts from different regions. Industries that need to educate employees in new procedures also may offer overtime hours during the training period to allow training to happen while also keeping the business fully staffed.
Employees of the retail and service industries often work overtime during busy periods and holiday periods. Stores may stay open longer during such shopping seasons and may not be able to or want to hire enough temporary staff to fill out the schedule. Restaurant staff will often receive overtime when an unusually large dinner crowd stays late. Other business sectors, such as the computer software industry, plan on having highly intensive work periods right before the release of a product. This so-called “crunch” time helps get products to shelves on time, but also is mentally and physically challenging for many employees.
From an employee perspective, overtime provides both an opportunity to earn more income and a loss of free time. Many employees jump at the chance to make more money, but others may be tired after a long day and want to go home to spend time with their families. Forced overtime for salaried employees is an unwelcome part of many careers. The 40-hour week, which was a standard in many areas during the last half of the 20th century, has been replaced with a longer expected working period for many professions.