Redundancy & overtime

fear345

We have been told our site is shutting in march 2012 and to cut a long story short 18 workers do contracted shifts at 48 hours per week 4 days (40 hours basic pay 8 hours time and half) and 5 of us are not on shifts but do 50 hours per week 5 days (40 hours basic 10 hours time and half).
We have been told shift workers will get redundancy calculated at 2 weeks per year service at 48 hours plus shift allowance, and us none shift workers calculated at 2 weeks per year service at 40 hours.

Us none shift workers have been doing this extra 10 hours overtime since the shifts started - so my question is do we have any chance of getting payed these extra hours in our redundancy package payed has average ?

fear345

Would this come under custom and practice since we have been doing it for so long ?

SarEl

No. Overtime is not included in the amount used for the redundancy calculation, no matter how long you have been doing it. Allowances are included. I am afraid that it is just the way the cookie crumbles.

mariefab

Us none shift workers have been doing this extra 10 hours overtime since the shifts started

Do you always work the extra 10 hours?
Is your overtime voluntary or compulsory?
If you hadn't already done so, I expect that when you changed to a 50 hour week you would have needed to sign your agreement to opt out of the maximum (48 hour) working week. Was your contract amended at that time to reflect the change?

Basically, if your contract says that your basic hours are 40 per week and you may/will be required to do overtime as needed (or something similar) then your redundancy pay will be based on 40 hours.

However, if it states that you are required to work 50 hours per week, 40 at flat rate and 10 at X1.5, your redundancy pay should be based on 50 hours.

fear345

We have always worked the extra 10 hours a week since our site went onto shifts about 7 years ago - Me and 2 others work in the warehouse and at the time of the rest of the site going onto shifts i proposed that we work the extra 2 hours a day to compensate for the extra work load that the shifts would make and this was agreed, our contracts have not changed since 1986 so are very basic but we where taken over in 2007 but our contacts where never changed or did we sign new ones, our HR guy has mentioned that he thinks we should get payed these extra ours has we have been doing it so long it has become custom and practice.

mariefab

Is your overtime shown seperately on your wageslips?

If your contract still says 40 hours, and the overtime isn't compulsory, then they can calculate your redundancy pay on that figure.

Has your employer given you any reason for their decision to include the overtime in calculating the redundancy pay for the shift workers but not for the other 5?

Perhaps the shift workers were given new/amended contracts when the shifts started showing that their contracted hours are 48.

fear345

The shift works did get new contracts that say 48 hours but like i say we have been doing a set amount of over time for 7 years now so surely that has become custom and practice.

mariefab

When calculating redundancy pay a week's pay is based on the number of hours required by your contract.

The shift workers' contracts state 48 hours. Their overtime is thus included in their contraually required working hours. So their redundancy pay must be based on a working week of 48 hours.

Your contract states 40 hours. Your overtime is not part of your contractually required working hours. So, your employer can lawfully base your redundancy pay on a 40 hour week.

'Custom and practice' doesn't help you in this instance.
The custom and practice has been that the shift workers' overtime was contractually included in their normal working hours and yours was not.

There's a lot of information on this in the Employment Rights Act 1996.
See the chapter on a week's pay that starts at section 220.
Also, section 234 that explains why, in your case, the shift workers' overtime is included.

http://www.legislation.gov.uk/ukpga/1996/18/contents

getmore4less

What would happen if you stopped doing your overtime? if they need it done you have 7 months to negotiate getting the hours contractual.

This would also test how voluntory it currently is.

What holidays do they pay the different workers if you get paid that the 50hr rate when on holiday that might help point to the company accepting you really do 50hrs.

If not the mistake was made 7 years ago not insisting on T&C's that gave the full benifits for the 50hr weeks like those on shifts got.

It might be worth trying to go done the C&P rouye for 5 people, espcialy ig HR are not sure, the cost to the company just to take legal advice might make them just pay out any way to keep peope hpy till they have to close.

SarEl

If the overtime is contractual (which is still not counted as part of the weekly wage just because the contract says they have to work overtime) then stopping working it will result in an immense cost saving for the employer - they can sack them! The law does not say that the overtime has to be voluntary - it defines exactly what is included in the weekly wage, and overtime is excluded.

getmore4less

SarEl wrote: »

If the overtime is contractual (which is still not counted as part of the weekly wage just because the contract says they have to work overtime) then stopping working it will result in an immense cost saving for the employer - they can sack them! The law does not say that the overtime has to be voluntary - it defines exactly what is included in the weekly wage, and overtime is excluded.

But if you can have multiple definitions of full time can't you effectively never have part time workers by defining full time a just about anything.

Since some full timers are 40 and some 48 could they not argue that full time is realy 48 hrs.