Is overtime pay legally required in the UK?
The short answer surprises most people: no law makes overtime paid. Here's what the contract decides, the two floors the law does set, and where unpaid hours cross the line.
No - there is no general statutory right to overtime pay in the UK, and no statutory overtime rate: whether extra hours are paid, and at what rate, comes entirely from the employment contract. The law sets only two floors: average pay for total hours worked in a pay reference period must not drop below the National Minimum Wage, and average weekly working time must stay within the 48-hour cap of the Working Time Regulations 1998 unless the worker has signed an opt-out.
Do employers have to pay overtime in the UK?
No. As gov.uk puts it, there's no automatic right to be paid extra for working longer - it all depends on what the contract says. Some contracts promise paid overtime at an enhanced rate; some pay the flat hourly rate; some offer TOIL instead of money; and some - typically salaried roles - promise nothing extra at all. Every one of those can be lawful.
That cuts both ways. Employees can't demand overtime pay the contract never promised - but employers can't skip overtime pay the contract does promise. A promised rate that isn't paid is a contractual debt, and withholding it can amount to an unlawful deduction from wages.
Is there a legal overtime rate, like time and a half?
No. "Time and a half" is convention, not law. There is no statutory overtime premium in the UK - no ×1.5 for evenings, no double time for Sundays or bank holidays, unless the contract says so. Whatever rate appears in your contract or overtime policy is the rate; if none appears, there's no enhanced rate to enforce. To see what different rates actually cost, try our overtime pay calculator.
What the law guarantees vs what the contract decides
| Question | What the law says | What the contract decides |
|---|---|---|
| Must overtime be paid? | No general statutory right | Whether extra hours attract pay, TOIL, or nothing |
| At what rate? | No statutory rate - "time and a half" is convention | Flat, enhanced, or unpaid - as written |
| Minimum pay floor | Average pay across all hours worked in the pay reference period must meet the National Minimum Wage | Cannot contract below it |
| Maximum hours | 48-hour average weekly cap (Working Time Regulations 1998) | Only a signed opt-out lifts the cap |
| Holiday pay on overtime | Compulsory or sufficiently regular voluntary overtime counts as normal pay for the 4 weeks of EU-derived leave; 52-paid-week reference period | Can be more generous, never less |
| TOIL | No statutory framework at all | Everything - existence, rate, expiry, leaver treatment |
When does unpaid overtime become unlawful?
Unpaid extra hours are lawful by default - until they hit one of the two statutory floors:
- The NMW floor. Take total pay in the pay reference period and divide it by total hours actually worked, unpaid overtime included. If the average falls below the National Minimum Wage, the arrangement is unlawful - however senior the role sounds.
- The 48-hour cap. Average weekly working time must stay within 48 hours under the Working Time Regulations 1998, unless the worker has personally signed an opt-out.
There's also the ordinary contractual route: if the contract promises payment for extra hours and it isn't paid, that's a breach regardless of the NMW arithmetic.
Do I have to work unpaid overtime if I'm salaried?
Whether you can be required to work extra hours at all is a contract question - check what yours says about additional hours. On pay, the honest answer for salaried staff is: extra unpaid hours are lawful only while your average pay stays at or above the National Minimum Wage. Divide your salary for the pay reference period by every hour you actually worked; a generous-sounding salary stretched over enough sixty-hour weeks can quietly slip under the floor, at which point the employer is in breach. The 48-hour average cap applies to salaried staff too, opt-out aside. If long weeks are constant rather than occasional, it's a workload conversation - and possibly a TOIL arrangement worth proposing.
Does regular overtime count towards holiday pay?
Often, yes - this is the rule that catches employers out. Overtime that is compulsory, or voluntary but sufficiently regular to count as part of normal pay, must be included in holiday pay for the 4 weeks of EU-derived leave. Where pay varies, the calculation uses a reference period of the last 52 paid weeks - see gov.uk on holiday entitlement and Acas's guidance. Paying basic salary only for someone who works regular paid overtime understates their holiday pay. The full leave picture is in our guide to UK statutory annual leave.
What should employers write down?
Because the contract does all the work here, ambiguity is the real risk. Say explicitly: whether overtime needs prior approval, the rate (or that it's unpaid), whether TOIL is offered and on what terms - our TOIL policy template covers that side - how overtime feeds holiday pay, and how hours are recorded so an NMW check is even possible.
How CoDash handles overtime
CoDash turns the policy into a workflow: employees submit their extra hours, managers approve them, and each approval lands automatically as TOIL on the leave balance or as a payroll line - with every hour recorded, so the NMW arithmetic and holiday-pay questions have data behind them. See it alongside time off and absence.
Frequently asked questions
Do employers have to pay overtime in the UK?
No - there is no general statutory right to overtime pay. The contract decides whether extra hours attract pay, TOIL or nothing, subject to average pay staying at or above the National Minimum Wage.
Is there a legal overtime rate, like time and a half?
No. Time and a half is convention, not law. The only enforceable rate is the one in the contract or policy.
When does unpaid overtime become unlawful?
When average pay for total hours worked in the pay reference period drops below the National Minimum Wage, or average weekly hours exceed the 48-hour cap without a signed opt-out - or when the contract promises payment that isn't made.
Do I have to work unpaid overtime if I'm salaried?
Your contract governs whether extra hours can be required. Unpaid ones are lawful only while salary divided by total hours actually worked stays at or above the National Minimum Wage, and the 48-hour average cap still applies without an opt-out.
Does regular overtime count towards holiday pay?
Compulsory overtime, and voluntary overtime regular enough to count as normal pay, must be included in holiday pay for the 4 weeks of EU-derived leave, calculated over the last 52 paid weeks.
Keep reading: All 66 HR guides · 30 free templates · 24 calculators
Overtime, minus the spreadsheet
In CoDash, employees submit overtime, managers approve it, and it lands as TOIL days or a payroll line automatically - with every hour on record. Try it in the demo.
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