Regular overtime may not count as a contractual right

Working overtime every day for a year does not necessarily give an employee a contractual right to overtime, the Employment Appeal Tribunal (EAT) has ruled in the case of two council workers.

Mr McDonald and Mr Thomson were employed to work in "hit squads" carrying out emergency road and environmental repairs. They agreed to work an extra 15 minutes at either end of the day - in the morning to carry out a vehicle check, and in the evening to do the end-of-day documentation - although this additional time was not written into their contracts of employment. They were paid overtime for their extra two-and-a-half hours' work per week.

The following year, the additional hours did become part of their contract, under new terms agreed with the union to achieve harmonisation. McDonald and Thomson said the overtime had always been contractual and should have been taken into account in calculating their holiday, sick pay and pensions over the previous year.

However, the EAT rejected their claim. Just because something has been paid for a certain period, it said, it is not necessarily a contractual right.

Terms and conditions can only be implied as contractual rights if there is evidence that they were intended to be part of the contract, and the tribunal hearing McDonald and Thomson's case had accepted the council's argument that overtime was never a contractual right or obligation but had only been brought in as a trial measure.

North Lanarkshire Council v McDonald & another EAT/0036/06