New research from the Centre for Future Work found that unpaid overtime hours were fewer in 2024 than in previous years.
The Centre’s update pointed to the Government’s ‘right to disconnect’ law, introduced last year, as a potential cause for the drop in overtime. The measure gave employees the legal right to refuse work-related contact outside of regular working hours. The goal was to encourage workers to “leave work at work”, protect them from overzealous higher-ups, and, ultimately, to lessen the amount of unpaid overtime.
The right to disconnect will apply to small businesses from August this year. While the drop in unpaid overtime might make some optimistic about the law’s rollout, its impact on small-business working hours remains uncertain.
Employees still work five extra weeks a year in unpaid overtime
It’s a positive sign that overtime hours have decreased. However, employees continue to put in a significant amount of extra unpaid hours.
According to the Centre for Future Work’s research, employees are still working an average of 3.6 hours of unpaid work per week. This is equivalent to 10.9 per cent of total working hours, or almost five standard 38-hour work weeks per year.
Why is unpaid overtime still so high?
The most common reason for working overtime was simply having too much work.
The findings align with what workplace expert Louise Gilbert has seen while working with large businesses since the right to disconnect law was introduced.
“This year, with organisations that I have worked with, [the right to disconnect] hasn’t been a big deal,” said Gilbert. “[Employees] are given too much work, which can be one of the causes of burnout that we need to really consider.”
Additionally, Gilbert has found that employees often choose to work unpaid overtime on their own, rather than being asked to by another employee.
“Culturally, people aren’t expected to work outside of their normal hours,” she explained. “They’re not contacted consistently outside of their set work hours… That doesn’t mean that they don’t feel like they have to work however.”
The right to disconnect targets situations where extra work is imposed by a boss or coworker. It assumes that restricting after-hours work discussions will eliminate overtime. However, many employees choose to work overtime voluntarily due to external pressures; pressures that this law doesn’t address.
That doesn’t mean that coworkers have no role in the overtime dynamic, however. Gilbert said that workplace culture has a significant impact on whether employees work overtime.
“What it comes down to is culture, because leaders set the tone from the top,” she explained. “It’s very important for leaders to be mindful of the culture that they’re creating. We would hate for the right to disconnect legislation to come into play, but then for disconnection to become career-limiting.”
Does the law reflect the way that small-business owners work?
The right to disconnect legislation presupposes that most people work a set number of hours and then clock off, after which no work is done at all. In reality, many people don’t work like this anymore – least of all small-business owners.
As ISB has previously heard from entrepreneurs, many work outside of the 9-5 hours. This is both because this schedule suits them and because they feel they have to do it.
“As the owner of the business, I have always felt that my work can crop up at any time, day or night,” says Jeremy Dawes, owner of website design business Jezweb. “We have flexible work-from-home (WFH) arrangements for our team. The office is there for any time and day the people want to go in or maybe have a client meeting. Everyone is set up with a workspace at home.”
Sole-trader Roxy Sinclair says she has made a “conscious decision” to forgo a set schedule.
“I prioritise family and health, slotting work in around that,” says the owner of Sinclair Communications. “Obviously meetings and some tasks need to occur at particular times but any planning, writing or research can be done whenever it suits.”
With the right to disconnect not yet in place for small businesses, only time will tell its effectiveness.
