Not paying overtime but changing it to a holiday instead, is this something the company can do? And is it in accordance with the labor law?
The issue of overtime pay or OT (short for Overtime) is an issue that has been misunderstood in many aspects. For example:
Working overtime in exchange for more holidays. Can the company do that?
The company or employer offers to allow employees to work on holidays, but does not pay overtime, but offers a quota of holidays instead. For example, a boss (a representative of the company or employer) orders employees to work on a public holiday for 1 day and tells the employees that he will compensate for working on this holiday by giving them an additional vacation day.
The problem is not just working one holiday. The boss has to work on many holidays. Each time he comes to work, he has to add more vacation days to make up for it until the number of vacation days has doubled. When the employee wants to use the vacation rights, the boss refuses to approve it or approves only the amount of annual vacation that the company has set for him.
In this case, it turns out that this employee is working on holidays for free without getting anything.
Overtime work must be paid in cash only and cannot be exchanged for additional holidays.
Overtime pay (OT) must be paid in cash only. It cannot be compensated as a holiday. Refer to the Labor Protection Act B.E. 2541.
Normal working hours, for example, if it is a normal general job, it must not exceed 8 hours per day or as agreed upon between the employer and the employee, and must not exceed 48 hours per week.
For overtime work or work on holidays
The company or employer may allow the employee to do so with the prior consent of the employee from time to time, but the total hours of overtime work, work on holidays and overtime work on holidays must not exceed 36 hours per week.
And in the case where overtime work is done after normal working hours for no less than 2 hours, the company or employer must provide employees with a break of no less than 20 minutes before employees start working overtime (but there are exceptions for work that requires the nature or conditions of the work to be done continuously with the consent of the employee or such work is an emergency).
Overtime pay, holiday pay and overtime pay on holidays
To understand better, let’s assume that employees of a company have normal working hours of 8:00 AM – 5:00 PM and normal working days are Monday to Friday.
- The first employee is a monthly employee who receives a salary of 25,000 baht per month.
- The second employee is a daily worker who earns 450 baht.
Compensation in case of overtime work on normal working days:
According to the law, if an employee works beyond the normal working hours of a working day, the employer must pay overtime pay of not less than 1.5 times the hourly wage rate on a working day based on the number of hours worked, or not less than one and a half times the unit wage rate on a working day based on the amount of work done for employees who receive wages based on results.
If the boss orders both employees to work overtime until 8:00 p.m. (the number of overtime hours is 3 hours)
- The first employee will receive overtime pay = (monthly salary / 30 days / normal working hours 8 hrs.) x 1.5 times x number of OT hours = (25,000/ 30/ 8) x 1.5 x 3 = 468.75 baht.
- The second employee will receive overtime pay = (Daily wage / Normal working hours 8 hrs.) x 1.5 times x Number of hours worked overtime = (450/8) x 1.5 x 3 = 253.125 baht.
Compensation in case of working on holidays:
According to the law, if working on a holiday is during normal working hours on a holiday, such as normal working hours on a holiday, employees must work from 8:00 a.m. to 5:00 p.m., in such cases, employees are entitled to receive holiday pay (public holidays, traditional holidays, Saturdays and Sundays, etc.). The holiday pay rate is divided into 2 sub-cases: employees who are entitled to receive holiday pay, such as monthly employees, will receive holiday pay no less than 1 time, and employees who are not entitled to holiday pay, such as daily employees, will receive holiday pay no less than 2 times.
- The first employee will receive overtime pay = (monthly salary / 30 days / normal working hours 8 hrs.) x 1 times x number of OT hours = (25,000/ 30/ 8) x 1 x 3 = 312.5 baht.
- The second employee will receive overtime pay = (Daily wage / Normal working hours 8 hrs.) x 2 times x Number of OT hours = (450/8) x 2 x 3 = 337.5 baht.
Compensation in case of working overtime on holidays:
According to the law, if work is done on a holiday beyond the normal working hours of the working day, the employer must pay overtime pay on the holiday to the employee at a rate of 3 times the hourly wage rate on the working day based on the number of hours worked or the amount of work done for employees who are paid based on the results calculated per unit.
- The first employee will receive overtime pay = (monthly salary / 30 days / normal working hours 8 hrs.) x 3 times x number of OT hours = (25,000/ 30/ 8) x 3 x 3 = 937.5 baht.
- The second employee will receive overtime pay = (daily wage / normal working hours 8 hrs.) x 3 times x number of OT hours = (450/8) x 3 x 3 = 506.25 baht.
Conclusion
At this point, I hope we understand that not paying overtime but instead giving a day off is wrong and against the law.
Because of overtime work, exchanging it for another day off or accumulating it as a holiday is not possible because it is not “money”. This principle also includes overtime pay for working on holidays. It must be paid in money only. It cannot be exchanged for holidays.
If the company or employer does not comply with the law, the consequences are that the employee or worker may claim retroactive overtime pay with interest.
In terms of the statute of limitations, the law stipulates a statute of limitations for wages and overtime pay of 2 years.
Therefore, if an employee or worker has resigned, they still have the right to return and sue the company or employer if the statute of limitations has not exceeded 2 years.
thank you
Information from the Ministry of Justice and the Office of Labor Protection and Welfare
If you have any questions about labor issues, you can ask for more information at the Provincial Welfare and Labor Protection Office in every province or the Bangkok Welfare and Labor Protection Office or call the hotline 1506.
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