Right to Disconnect fallouts: How HR should handle compensation for extra hours

It has been a month since Australia’s "Right to Disconnect" law came into effect, granting employees the freedom to unplug after hours. While the legislation aims to curb burnout by preventing after-hours work communication, it has raised important questions for HR professionals. Not every day allows for a clear-cut end to work. Whether due to deadlines, unexpected crises, or urgent projects, some employees still find themselves working beyond their stipulated hours. As HR professionals try to balance legal compliance with organisational demands, a new challenge emerges: how to fairly compensate employees for these extra efforts and how to set clear guidelines for when enough is enough.

The grey area of disconnecting

The Right to Disconnect law is a well-intentioned move toward protecting employees’ mental health and well-being by ensuring they are not expected to be available after hours. However, it doesn’t always take into account the fluid nature of modern work, where deadlines, client demands, and unforeseen issues may require employees to log back on after hours. For many employees, work doesn’t stop at 5 p.m. sharp, and the reality of their roles means that being truly “off the clock” is not always an option.

As these gray areas persist, HR teams are tasked with creating frameworks to address instances when employees do end up working beyond regular hours, without leaving employees underpaid or undervalued for their time.

Setting clear guidelines for overwork

To address the challenge of after-hours work, HR needs to establish clear guidelines on what constitutes "overwork." It’s not just about the number of hours worked but the frequency and intensity of these overtime efforts. Here are a few questions to guide this process:

• What counts as essential after-hours work? HR must define what constitutes necessary work outside regular hours. Is responding to an urgent client request after hours acceptable? Is working late to meet a deadline considered part of the job, or does it require special compensation?
• How can overwork be measured? Not all employees experience overwork the same way. Some thrive on putting in extra time, while others may feel overwhelmed. HR can set up tracking mechanisms to monitor how often employees are required to work beyond normal hours. Whether through self-reporting or digital tracking tools, identifying patterns in overtime work is essential.
• How much is too much? Defining "too much" overtime is crucial. Research suggests that consistently working more than 48 hours per week can lead to burnout, decreased productivity, and health problems. HR policies should reflect this, ensuring that any work beyond normal hours is carefully monitored and doesn’t become a habit.

Offering fair compensation for extra work

Once guidelines are in place for identifying when employees are overworked, the next step is determining how to fairly compensate them. The following are some practical ways HR can reimburse employees for working beyond their regular hours:

1. Overtime Pay or Bonuses

For hourly workers, overtime pay is a straightforward solution. For salaried employees, however, compensation can become more complex. While these workers are typically expected to work longer hours, frequent after-hours work can warrant a bonus or additional compensation. Offering a structured overtime pay system can help avoid burnout and ensure that employees feel fairly compensated for their extra efforts.

2. Time Off in Lieu (TOIL)

Another effective way to compensate employees is by offering additional time off in exchange for their after-hours work. Known as Time Off in Lieu (TOIL), this policy allows employees to take additional leave based on the extra hours they’ve worked. This not only gives employees a chance to rest and recharge but also encourages work-life balance, which aligns with the spirit of the Right to Disconnect law.

3. Flexible Working Hours

Allowing employees the freedom to adjust their working hours on days when they’ve worked late can also alleviate the pressure of overwork. For example, if an employee stays late one evening, they can start work later the next day. This helps employees manage their workload without sacrificing personal time.

4. Mental Health Days

In addition to financial compensation, HR could also offer mental health days. These are paid days off that employees can use when they feel mentally or emotionally overwhelmed. This recognizes that overwork not only affects physical productivity but also mental well-being. By offering dedicated time for rest and recuperation, HR can create a culture of well-being.

5. Employee Assistance Programs (EAPs)

HR should also invest in Employee Assistance Programs that provide mental health resources, stress management training, and wellness support. Having access to these resources can make employees more resilient to the pressures of after-hours work.

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Balancing organisational needs with employee well-being

While the Right to Disconnect law is designed to protect employees from burnout, it doesn’t mean that businesses stop operating outside of regular hours. The key for HR teams is to strike a balance between these competing needs. Here are a few strategies HR can adopt to maintain this balance:

Clear Communication and Expectations

One of the most important aspects of managing after-hours work is setting clear expectations. Employees need to know when they are expected to be available and when they are not. This clarity can prevent unnecessary overtime and allow employees to truly disconnect when they need to.

Empowering Managers

HR should also empower managers to play an active role in managing employee workloads. Managers are often the first to know when an employee is taking on too much work, so giving them the tools and training to address this issue can be incredibly helpful. Managers should regularly check in with their teams to ensure workloads are manageable and that employees aren’t consistently working after hours.

Monitoring Workloads

HR teams can use digital tools to track employees' work patterns and identify those who are frequently working after hours. Regular reviews of workload distribution can ensure that no one is consistently overburdened, and necessary adjustments can be made in real time.