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Working long hours is often considered to be a sign of a dedicated worker. But it comes at a cost, for both employers and employees.
Everyone loses if employees feel pressure to work extra hours without recording them, attorneys and HR professionals say. It’s not just a question of the legal liability that employers face if they don’t pay overtime: there’s also lots of evidence that overworking leads to exhaustion.
But legal liability should certainly concentrate employers’ minds. The cost to employers caught cheating their employees of overtime pay can be severe.
The Fair Labor Standards Act provides for liquidated (double) damages and attorneys’ fees for plaintiffs, with a two-year “lookback” that can be increased to three years for willful violations, allowing an employee to recover for damages looking back up to three years, Robert L. Kilroy, a partner at Mirick, O’Connell, DeMallie & Lougee LLP, told Bloomberg Law. In Massachusetts, damages are automatically treble, with a three-year lookback, he said.
Civil penalties can also be assessed for failure to record overtime worked, a charge that is hard to refute, Kilroy said. And all of this can apply even if the worker wasn’t pressured into working the unpaid overtime, he said.
Don’t blame human resources for these pressures, Wes Pruett, owner of Fairmont, Minn.-based consultancy HR Advisors, told Bloomberg Law. “I don’t think it’s usually HR that has the authority, it’s managers and supervisors. It’s the culture; if everyone is expected to answer emails at 10 p.m., something is supporting that. It’s on leadership; if you’re a workaholic, employees will see and model that.”
Creating an informal culture of overwork is a good way to depress recruitment and retention, especially among millennials who expect a decent work-life balance, Pruett said.
To counter “unwritten policies” that encourage employees to always be available to answer phone calls or emails, even when not on duty, workplace psychologist Ilona Jerabek suggests creating clear written policies that off-hours contact with work will come only in case of emergency and from a designated supervisor.
“If supervisors notice employees are working longer hours than authorized, they should have discussions to determine if additional resources or help with prioritization are needed,” Brandi Britton, district president of Menlo Park, Calif.-based staffing firm OfficeTeam, told Bloomberg Law in an email. “Reminders can be made regarding standard office hours and overtime rules.”
In addition to potential liability and recruitment headaches, academic studies suggest that if workers are compelled to be on the job for well over standard hours, their productivity will decline and they may even only pretend to work.
Pressure to put in more working hours is counterproductive, Jerabek, president and chief executive officer of Montreal-based PsychTests, told Bloomberg Law. She said it tends to result in “presenteeism"—employees sticking around for extra hours because they think it looks good—"but they won’t really be working and will be tired the next day.”
“Employers need to understand that they’re not really gaining any productivity by overworking employees,” Jerabek, said. At her own company, she said, the employee handbook sets out “in plain language, not legalese” what is expected of employees, who are only to work regular hours unless they get an explicit request.
Evidence that some people only pretend to work during extra-long hours on the job comes from a 2015 study in the academic journal Organization Science. At the large consulting firm that was the object of the study, there was pressure to be “always on,” working all the time. “Some really did it, some faked it,” study author Erin Reid, associate professor of human resources and management at Canada’s McMaster University, told Bloomberg Law.
In reality, “anything over 50 hours a week, especially in creative fields, people just get exhausted,” Reid said.
In the manufacturing sector, declining productivity during unnecessary overtime is the norm, John H. Pencavel, an emeritus professor of economics at Stanford University, told Bloomberg Law. Employers need to know about workers’ decreasing productivity during extra working hours and “respond by setting hours that don’t hurt their productivity,” he said.
Understanding of the pointlessness of long working hours for their own sake has yet to spread among the working public, more than three quarters (78 percent) of whom believe working more hours is at least moderately important to getting ahead in their careers. Precisely half said the same of socializing with colleagues outside working hours, according to a survey by Salt Lake City-based corporate training software provider Instructure. The company queried more than 1,000 U.S. office workers at companies with more than 250 employees in an online survey in released Nov. 14.
“A lot of people raised concerns in our survey around what is expected and not expected,” Jeff Weber, senior vice president of people and places at Instructure, told Bloomberg Law Nov. 13. He said employers need to counter informal pressures to overwork “if they really care about employees.” They can do this by making it clear that “they care about results, not face time,” he said.
Society’s myths unfortunately push the other way. “People talk about how they really want Superman on their team, flying all over the world in the middle of the night,” Reid said.
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An abstract of the study in Organization Science can be found at http://pubsonline.informs.org/doi/pdf/10.1287/orsc.2015.0975.
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