In the summer of 2021, the federal government renamed a specific overtime scheme, which initially applied only to "essential" sectors, into a general scheme that any employer can now use: the net overtime allocation. Also for 2022, employers can grant a sum of 120 net overtime hours to their staff: an excellent motivator for the employees who are putting their shoulders to the wheel of post-Corona reconstruction.
In the following article, we briefly list the most important issues.
What is the cost of net overtime?
Net overtime is overtime for which the employee receives his/hergross hourly pay in full. Specifically, this means the following:
- The employer should not grant an overtime allowance;
- Likewise, no catch-up rest should be granted;
- These hours are not subject to withholding tax and personal income tax;
- Neither the employer nor the employee must pay social security contributions;
Needless to say, the allocation of net overtime is a particularly optimized form of compensation, where the net benefit to the employee coincides seamlessly with the total cost to the employer.
What are the limitations of net overtime?
As mentioned above, for calendar year 2022, each employee can be a sum of 120 net overtime hours grant. To this end, the employee must agree in writing to work net overtime for a renewable period of six months. We recommend that this agreement be included in an individual contract with the employee before the overtime is worked.
Further, as an employer, you should keep in mind that on a weekly basis the employee may perform a maximum of 50 hours, and on a daily basis a maximum of 11 hours (regular hours and overtime included).
Do not hesitate to contact us here contact us with questions regarding the allocation of these overtime hours.
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