Overtime for part-time employees: What should employers prepare for?

A recent judgment from the District Court establishes that part-time employees are entitled to overtime pay as soon as they work beyond their agreed percentage of employment, even if they do not exceed ordinary working hours.

What should employers prepare for?

The Working Environment Act aims to ensure that employees, to the greatest extent possible, are employed full-time. Nevertheless, many employees prefer part-time positions, often combined with the opportunity for extra shifts. If your organization has many part-time employees, there are a few things to keep in mind.

If an employee has regularly worked beyond their agreed part-time percentage over the past year, they have the right to an increased position that reflects their actual working hours. There is no corresponding right for the employer to require the employee to increase their position. The District Court’s interpretation of overtime for part-time employees will make it more profitable for employees to hold a lower fixed position while taking extra shifts. Consequently, the employee’s right to demand increased employment position may become less attractive.

Furthermore, under the Working Environment Act, part-time employees have priority for extra shifts over the employer hiring new staff or outsourcing labor. The District Court ruling would mean that organizations that largely rely on part-time employees to fill gaps in schedules with voluntary extra shifts may face significant additional costs if such shifts now have to be paid as overtime.

The recently issued District Court judgment is only one of several ongoing cases addressing this issue and has so far only been decided in the lower court. Although the final outcome on this topic has not yet been decided, there is every reason to approach this issue thoughtfully and proactively.

If the District Court’s application of the law stands, employers who have relied on part-time models should consider adjusting their practices. There is no universal solution, but there are some practical steps to reduce risk. For new part-time hires, it will be particularly important to establish the “actual” percentage of employment and avoid setting it too low. It may also be smart to examine the possibility of agreements on average working time calculations. The District Court also assumes that on-call substitutes do not have the same right to overtime pay as other employees. While the use of on-call substitutes is subject to strict conditions, in some selected situations, this can be a practical alternative.