The topics of overtime, overtime and the correct recording of working hours regularly give rise to questions in many companies. Unclear regulations quickly lead to misunderstandings or conflicts. Those who are familiar with the legal basis and clearly set it out in the employment contract create transparency and avoid disputes.
Overtime vs. overtime – the key distinction
In everyday life, the two terms are often equated, but legally they are two different categories:
Overtime
– arises when more is worked than specified in the employment contract or in a CEC
– the basis is the individual employment contract or the “normal working hours” pursuant to Art. 321c CO
– is therefore a civil law issue between employer and employee
Overtime
– concerns working hours in excess of the statutory maximum working hours under the Employment Act
– 45 hours/week for office, technical and sales staff in large companies; 50 hours/week for all other
– is regulated by mandatory public law
This distinction is key, as different rules apply to compensation and indemnification.
How is overtime paid?
The Code of Obligations gives the parties certain freedoms:
Possible variants of compensation:
- Compensation through time off (same duration), provided the employee agrees
- Payment with the normal salary plus at least 25% supplement (Art. 321c para. 3 OR)
- Deviating regulation through CLA or written agreement
- Under certain conditions: written agreement that overtime is included in the salary
Important: Everything should be set out in writing to prevent later discussions.
How is overtime remunerated? (mandatory law)
Freedom is severely restricted in the case of overtime:
- Overtime must always be paid at least 25% overtime (Art. 13 ArG).
- Exception: office, technical and certain sales staff – here only overtime over 60 hours/year must be compensated.
- Compensation in the form of time off is also possible with the employee’s consent. The period is generally 14 weeks, but can be extended jointly for up to 12 months (Art. 25 ArGV 1).
Contractual deviations to the detriment of employees are not permitted.
Special case: senior executives
Certain functions are not subject to the provisions of the Labor Act regarding maximum working hours:
Senior executives are persons who:
- have comprehensive decision-making powers
- significantly influence the strategic direction or organization of a company
- are typically located at management or director level
The Federal Supreme Court interprets the term very restrictively – a purely managerial function is not sufficient.
Recording working hours – what needs to be documented?
The complete recording of working hours is required by law (with the exception of senior executives). Depending on the model, this must be documented:
- Start and end of daily working hours
- Total working hours per day/week
- Position of working hours worked
- Breaks from 30 minutes
- Weekly rest periods
- Differentiation between overtime and extra hours
Clean time recording is not only a compliance issue, but also supports the fair treatment of overtime.
Practical tips for employers
1. clear employment contract regulations
Define transparently how overtime is dealt with (compensation, payment, inclusion in salary).
2. regular monitoring of working hours
This allows overloads, missing breaks or the threat of overtime work to be recognized at an early stage.
3. train managers
Managers should know the differences between overtime and overtime in order to make correct decisions.
4. use digital time recording solutions
They reduce errors, facilitate evaluation and increase traceability for both sides.
Conclusion
A clear distinction between overtime and extra hours is essential, as the two categories are treated differently in legal terms. While overtime can be regulated flexibly, compensation for overtime is mandatory by law. Companies are obliged to record their employees’ working hours correctly – ideally digitally and in a comprehensible manner. Creating clear contractual solutions and complying with legal requirements ensures fairness, planning security and a transparent working environment.
