Legal and Trade Union Limitations Upon Hours of Work: The Problem of Overtime

Proposals to limit the number of overtime hours are held to be in the tradition of social reform of factory conditions. In a modern industrial context, overtime is defined to be those hours over which employees may exercise discretion. The impact of legislation and trade unions upon hours of work in the UK and the USA is examined and found generally to be secondary to that of market pressures. In pressing for limitations upon hours of work, trade unions have insisted upon maintaining the level of real earnings. In part, this is explained by the recognition that, without the opportunity or the ability to acquire saleable skills, low-paid employees have only long hours to offer as a means of achieving 'adequate wages'. Earnings are two-dimensional, the product of wage rates and hours of work. In its impact upon earnings, the imposition of greater uniformity upon the latter would create problems akin to those raised by the attempt to reduce wage differentials. This assertion is backed by evidence from the UK on the distribution of overtime by age, sex and occupation. The argument that a cut in overtime hours would provide the basis for job creation during a period of chronic unemployment is undermined by the necessity to reduce labour costs per unit of output.