Work from home causes jump in unpaid overtime

A new survey by the Australia Institute’s Centre for Future Work (CFW) suggests that people are doing more unpaid overtime while working from home (WFH) during the coronavirus pandemic. It has found that the average amount of unpaid work each week has risen from 4.6 hours in 2019 to 5.25 hours in 2020; this equates to more than seven weeks of full-time work a year:

On average, people reported they had worked 5.25 hours of unpaid work in the last seven days. This was an increase from 4.62 in 2019.

There are significant differences in the incidence of unpaid overtime across different forms of employment. Unpaid overtime is more severe for full-time workers, who reported an average of 6.21 hours per week. Self-employed workers also reported heavy unpaid overtime: 4.25 hours per week. But even among part-time and casual workers, who are anxious to attain more paid work (as reported above), unpaid overtime is endemic: 4.16 hours per week for part-time workers, and 2.71 hours per week for casual workers. Across all employment types other than self-employed, there was an increase in unpaid overtime between 2019 and 2020.

Significant amounts of unpaid overtime are thus incurred across all major employment categories (see Table 2). At the macroeconomic level, this unpaid overtime removes purchasing power from the economy, relative to what workers—who are also consumers—would be able to wield if they were fully remunerated. This is especially concerning during a period of decreased household confidence, and resulting negative pressure on businesses, wages and employment; this only reinforces downward pressure on purchasing power, spending, and employment. One important priority for governments at all levels, who employ a substantial proportion of the workforce, is to ensure their own workers are compensated for all time worked—as well as implementing policy measures to reduce the incidence of unpaid overtime and ‘time theft’ in private sector workplaces.

On an annualised basis (assuming a constant rate of unpaid overtime throughout the year), this translates into an annual average of 273 hours of unpaid overtime per year per worker across all forms of employment. Based on a standard 38-hour work week, this is equivalent to more than seven weeks of unpaid work per worker per year. Extrapolated across Australia’s workforce, this implies total unpaid overtime worked of some 2.9 billion hours per year…

Men reported an average of 6.09 hours of unpaid overtime per week, compared to 4.24 hours for women. It is concerning that those aged 18-24 (6.90 hours) performed the most unpaid overtime…

The situation is not as dire as portrayed by the CFW. Australian employees are also enjoying big benefits from working from home, including not having to commute to work. These time savings (and costs) dwarf the slight weekly increase in unpaid overtime of around 40 minutes per week.

Survey after survey after survey also show that Australian employees want to keep WFH in some capacity once the COVID-19 pandemic ends. Thus, most employees seem satisfied with WFH and don’t feel exploited.

Unconventional Economist
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Comments

  1. WFH causes jump in unpaid overtime. FFS – go back into the office then and clockwatch.

    Our office remains open for any and all employees that don’t want to work from home. This extends to the – can work buy me a new chair for WFH? No. We provide chairs at the office. To WFH you need to sign off that your space is appropriate egnomically etc.

    I agree with the conclusion – take the WFH and stop the complaints – the choice isn’t WFH with a payrise or the office. The choice is office OR WFH.

  2. The90kwbeastMEMBER

    I am noticing my hours dragging out, partly as people are taking advantage of the fact that because you don’t have a commute, you still may be able to ‘do this one thing real quick’ when the email comes through at 5pm, which would otherwise be a ‘no’ because you have to commute home.

  3. Its not really overtime. Its just the time you should have spent on work during the day, when you were actually playing with the kids, watching telly, facebooking, mowing the lawns, and all those other things you get to do when “working” from home. Lets be honest.

  4. The spectre of job loss has been used beautifully to up the productivity, even when there’s no chance of a job loss.

    ‘Don’t complain, you’re lucky to have a job…….’

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