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A little-known fact you need to know about the effect of sick leave on overtime pay

by , 14 July 2015
Do you have an employee or a number of employees who often work overtime?

If you do, it's important for you as the employer to know how sick leave affects overtime pay.

In a nutshell, if an employee takes sick leave on overtime pay, he works less hours. As a result, iit will affect his pay.

I'm going to use an example to explain the effect on an employee's pay in such a case...

This is how sick leave affects overtime pay

Let's say you have an employee, Caroline.
 
Caroline normally works six days per week. Eight hours per day from Monday to Friday, and five hours on a Saturday. That totals to 45 hours per week.
 
Last week, Caroline asked to work an additional three hours on the Saturday. This would normally amount to 'overtime', meaning you'd have to pay her at the overtime rate.
 
But on Wednesday last week, she took paid sick leave. As a consequence, Caroline only worked 40 hours.
 
So how do you pay her?
 
In addition to you paying Caroline for a full day when she was off sick, you'll also pay her for 40 hours at the normal rate. For the three hours overtime that she worked on the Saturday, you only need to pay her at the normal rate of pay – not the overtime rate. This is all you legally owe her.
 
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You can apply the above as a general rule unless the employee's contract contains more favourable provisions regarding 'overtime'. Always double-check what the contract states first.
 

What the BCEA says about sick leave on overtime pay

The BCEA states that an employee is entitled to the overtime rate (one and a half times the normal rate) if he/she works for more than 45 hours per week.
 
However, the BCEA is silent on whether you as the employer need take paid time for sick leave into account when calculating overtime pay. If the employee is absent due to illness during a particular week, you don't have to take such hours of absence into account for the purposes of calculating overtime pay.
 
It's only an order to pay the employee at the overtime rate if he/she worked in excess of 45 hours in that week.
 
You can apply this principle in other cases of absence too where an employee is entitled to payment. For example, annual leave, family responsibility leave or public holidays.

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