Thursday, 20 October 2016 14:56

The Consequences of Understaffing

If the staffing level is lower than optimal then the employees in that operation have to work additional hours or extra shifts to keep the positions filled. These hours may be added on by:

  1. Holding employees over for additional hours at the end of their shift (i.e. effectively increasing the actual shift length and reducing off-duty rest hours between shifts).
  2. Calling employees in early for additional hours at the beginning of their shift (i.e. increasing the actual shift length and reducing off-duty rest hours before the shift).
  3. Scheduling employees to work on their days off to cover open shifts (thereby increasing the number of consecutive workdays and/or reducing the number of consecutive days off)
  4. Short notice call-in to cover vacant positions (creating the potential to miss or compromise a planned sleep period and thus start the shift unrested and/or less fit for duty).
  5. Having employees work double or even triple shifts (increasing actual shift length and reducing off-duty rest hours after the shift).

As a result, the amount of overtime worked by employees will be significantly increased, and the additional hours and days worked will make the published shift schedule a work of fiction. Up to a point, overtime is often welcomed, if not desired by many employees, as an understandable way to increase their paychecks. Some employees will volunteer for all of the overtime they can get, which buffers those who don’t want the extra hours. This also makes life easier for their supervisors. However, from every scientific and operational perspective, any significant understaffing, especially when there is uneven distribution of overtime, will affect both acute and chronic fatigue levels, and can represent a high-risk occupational health and safety exposure. 

This white paper does not advocate a goal of zero overtime. After all, when distributed and managed efficiently, overtime provides a measure of operational flexibility and it gives people a chance to earn additional pay. Instead the objective of the white paper is to educate managers at 24-hour operations on the causes and consequences of understaffing, and to help them address staffing

Thursday, 07 May 2015 19:42

Q&A: Staffing Levels

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Is it necessary to increase staffing levels when converting to a 12-hour shift schedule?

Longer 12-hour shifts don’t necessarily require additional staffing. Unless there’s an increase in the number of days an operation runs (i.e. converting from a 5- to a 7-day operation schedule), staffing levels can remain the same.

With that being said, schedule changes are a great time to review staffing levels – ideally, this occurs prior to the schedule change. Adequate staffing on 12-hour shifts is paramount, because excessive overtime poses a myriad of risks to both workers and the operation (e.g. safety concerns, productivity declines, health problems).

Throughout CIRCADIAN’s 30 years of assisting operations with schedule conversions and staffing level analyses, we know that using schedule conversions to reduce staffing levels can cause major workforce issues – often resulting in increased turnover rates, management-worker tensions and lowered employee morale.

Industry experts recommend that overtime levels shouldn’t exceed 10-12% of regularly scheduled hours, not including ‘built-in’ overtime seen in many industries (i.e. regularly scheduled 42 hour work weeks). When overtime rates approach 15%, management should begin to recruit and hire new workers. If overtime rates reach 20% or greater, immediate changes should be made to staffing levels and/or shift schedules.

Download our Staffing Levels White Paper

To learn more about analyzing your staffing level, download our free white paper:

Staffing Levels

Managing Risk in 24/7 Operations
staffing levels white paper
staffing levels white paper download
Friday, 19 December 2014 17:02

Top 10 Shift Work Myths

Myth #1 – Overtime within your workforce is evenly distributed

Best practices suggest that when overtime is equally distributed across a workforce, up to approximately 12% overtime is an acceptable rate. However, overtime rates vary across industries, companies and employees.

Research indicates that in many industries, 20% of employees work 60% or more of the overtime (Figure 4).1

Figure 4. Actual distribution of overtime at an extended hours facility.1Overtime distribution

Since accidents and safety problems can be caused by one fatigued employee, the risk of an accident occurring can rise as the distribution of overtime becomes increasingly skewed.

The imbalance exposes the pool of high overtime employees to extra health risks, and exposes the company to increased absenteeism costs, health care costs, safety issues, and legal liability.

Myth #2 – Employee productivity increases linearly

Studies and reports suggest that productivity can suffer with increased overtime hours.

Data from 18 manufacturing industries in the U.S. shows that for most of these industries, productivity (measured as output per hour) declines when overtime is used.2

On average, a 10% increase in overtime results in a 2.4% decrease in productivity (more output is achieved, but the number of hours worked increases as well—not as much output per hour is realized).

This performance decline is confirmed by the work of J. Nevison of Oak Associates. In his white paper, Nevison brings together scientific, business, and government data to demonstrate that little productive work takes place over and above 50 hours per week (Figure 2)3. Two other studies, also examined in the white paper, show that productive hours drop by an additional 10 hours when the number of consecutive long workweeks increases from four to 12, highlighting the cumulative effects that overtime can have on productivity.

Figure 2. Productive vs. actual work hours, from a collection of four studies4
overtime and productivity

Myth #3 – Adequate staffing means having enough employees to cover permanent positions

Often overlooked are the real drivers of overtime in 24/7 operations. In any given week, employees may not be available to fill their scheduled shifts because of multiple reasons including:

  • Vacation days
  • Floating holidays
  • Sickness related absenteeism
  • Non-sickness related absenteeism/personal days
  • Injury-related absenteeism
  • Training
  • Special work assignments (committees, team building, projects, etc.)
  • Jury duty, bereavement, FMLA, etc.
  • Turnover/delays in filling position with adequately trained employees

Many 24/7 operations do not realistically estimate or measure the full impact of these factors and hence run their shifts with fewer staff than needed, effectively increasing the relief coverage requirement (i.e. overtime) and impacting the time on duty and off duty of their personnel.

Furthermore, many companies do not monitor and analyze their historical payroll and human resources data so that they are unable to make even simple forecasts about scheduled and unscheduled absenteeism. Without this data, they are unable to accurately define seasonal, weekly and daily fluctuations in coverage demand.

Based on CIRCADIAN's 2014 Shiftwork Practices data, we found that the "leaner" operations (i.e. reduced staffing levels) reported higher absenteeism rates (Figure 1).

Interestingly, over 50% of all unscheduled absences are due to either: personal needs, stress, or an entitlement mentality (i.e. “I’ve earned it”).5

Figure 1. Staffing Levels & Absenteeism Rate 5absenteeism and staffing levels

Myth #4 – Operational decisions on shift scheduling are best if mandated by management.

Management-mandated work schedules often prevent an operation from reaching its full potential in terms of operational costs, productivity, efficiency, and safety.

Employee participation is just as important in the process of designing and implementing the new work schedule as the characteristics of the new work schedule itself.6-9

Surveys suggest that management-mandated work schedules can lead to:10

  • Increased absenteeism
  • Excessive overtime costs
  • Increased health problems and fatigue
  • Decreased morale
  • Increased turnover costs
  • Recruitment problems

Studies comparing methods of shift schedule selection have found that employee involvement in schedule redesign increases the benefits of schedule redesign considerably, as compared to management-mandated schedule changes. These benefits include:11-18

  • Increased worker satisfaction with schedule design
  • Decreased unscheduled absences from illness
  • Improved physical and psychological vigor
  • Decreased turnover and number of vacant positions
  • Increased organizational commitment
  • Improved employee and management relations

Myth #5 – If a shift schedule works well at our other plant, it will work for us here.

This is a common misconception in companies with multiple facility locations. A shift schedule that’s effective and well-liked at one facility can cause disagreements and tension among workers at a seemingly identical facility.

Shift schedules need to be based on the social, operational and physiological needs of the workforce and managers at each specific company site. Some factors to consider include:

  • Geographic location
  • The lifestyles of workers
  • Cultural differences
  • Worker demographics

These factors can greatly impact the popularity of different shift schedules among workers. For example, avoiding rush hour traffic is often important to workers in large cities, whereas workers in rural areas might prefer longer spans of days off.

Best shift scheduling practices suggest choosing a schedule with features that support the priorities of workers at each individual facility.

Pleasing everyone may be impossible, but having the majority of workers in favor of a new shift schedule will greatly increase the likelihood of a successful schedule change.

Myth #6 – Given the choice, workers always select the best schedule for them and the worst for the company.

Much conflict between management and shiftworkers is the result of misunderstanding and poor communication.

Management often feels that it is doing its part by “telling,” rather than both telling and listening to the needs of workers. Workers may feel that they’re providing valuable insight, but management only hears the complaints. As a result, management may feel that workers only care about themselves and making money.

While the occasional worker may try to game the system, most workers are truly concerned with the well-being of the company. After all, workers realize that any problem that the company faces will ultimately affect them. In light of this, most workers will choose a schedule that will satisfy the company while still fulfilling their individual needs.

The best way to ensure that workers understand the reasons for making any scheduling changes is by keeping them informed. This can be accomplished through company-wide meetings or events, as well as through regular emails or letters about the general state of the company.

Myth #7 – Falling asleep on the job is a matter of willpower

While curling up with a pillow and blanket at work is clearly deliberate, many fatigued individuals unknowingly experience microsleeps while working. A microsleep is a brief sleep episode that lasts up to 30 seconds, during which a person temporarily loses consciousness and external stimuli aren’t perceived.19

Individuals who experience microsleeps are often unaware that they briefly lost consciousness and will frequently deny that they fell asleep.20 When an individual arouses from a microsleep episode, it may feel like a brief lapse in attention or mind wandering.

Research suggests that even individual neurons can experience microsleeps, which means that your parts of the brain may be “offline” even if you’re seemingly awake.21

Microsleeps are most commonly associated with sleep deprivation and driving; however, microsleeps can also occur in the absence of sleep deprivation when completing monotonous, repetitive tasks.

Myth #8 – Napping during work is a lazy and unacceptable behavior

Before you write off napping as a leisurely activity that should be banned at work, you might want to consider the ways in which napping at your workplace can improve the alertness and productivity of workers.

Ten minute power naps provide immediate benefits upon awakening and boosts in performance that can last up to 4 hours!

Ten minute naps have been shown to: decrease fatigue, increase vigor, improve performance, improve communication, decrease blood pressure, improve reaction time, improve subject well-being, and increase alertness.

Longer naps that last 90 minutes (or longer) still offer many restorative benefits; however, they are not as efficient as power naps. Longer naps allow for memory consolidation and therefore have been shown to improve memory. Extended napping is frequently associated with profound sleep inertia, which can be crippling to productivity. In order to avoid the sleep inertia of long naps, it's advised to sleep a full 90 min sleep cycle in order to wake up at the lightest sleep stage.

Myth # 9 – Hours of service requirements are sufficient for mitigating employee fatigue

Most fatigue regulations start and end with hours of service policies. While this is a good starting place, it fails to address all of the factors that contribute to fatigue. To ensure the alertness of workers, a comprehensive fatigue risk management system (FRMS) needs to be in place.

CIRCADIAN® 5 Defenses FRMS Design

Fatigue risk management system

A fatigue risk management system (FRMS) is a data-driven, risk-informed, safety performance-based program that reduces the risk of fatigue-related incidents in 24/7 operations. An FRMS will continually monitor and reduce fatigue risk.

Workforces that have implemented fatigue risk management systems experience fewer problems with absenteeism, turnover and excessive overtime. Employees in these workforces have greater morale, less stress, and are more productive workers.

Myth #10 – There’s very little financial ROI with fatigue risk management

To some, fatigue might seem like a minor concern, yet it costs companies millions of dollars each year in excess costs, accidents and errors.

Fatigued workers cost employers $136.4 billion annually in health-related lost productive time (absenteeism and presenteeism), almost 4x more than their non-fatigued counterparts.22

Fatigued workers exhibit up to 4x the worker’s compensation costs as compared to non-fatigued workers (Figure 3).24 A recent meta-analysis of 27 observational studies found that sleep problems increase the risk of workplace injuries by 62 percent.23

Figure 3. Fatigue Levels & Worker’s Compensation24

fatigue and worker compensation Addressing and mitigating fatigue within an operation can significantly decrease excess costs related to: absenteeism, turnover, accidents, and healthcare.

fatigue risk management system savings

 

Debunk Other Shift Work Myths

Explore the variety of CIRCADIAN white papers that cover an assortment of 24/7 workforce topics including:

  • Shift Scheduling
  • Staffing Levels
  • Fatigue Risk Management Systems
  • Shiftwork Lifestyle Training
  • And much more!

white papers

 






REFERENCES

  1. CIRCADIAN databases
  2. Shepard E, Clifton T. Are Long Hours Reducing Productivity in Manufacturing. International Journal of Manpower 2000; 7.
  3. Nevison, J. Overtime Hours: The Rule of Fifty
  4. Permission from Nevison, Oak Associates.
  5. CIRCADIAN. 2014 Shiftwork Practices.
  6. Hauburger. Implementation of self-scheduling in the poison center. Vet. Hum. Toxicol. 39(3),175-7. 1997.
  7. Knauth P.The design of shift systems. Ergonomics 36(1-3),15-28. 1993.
  8. Knauth P. Changing schedules: shiftwork. Chronobiol. Int. 14(2),159-71. 1997.
  9. Kogi K, Di Martino VG. Trends in participatory process of changing shiftwork arrangements. Work & Stress 9 (2/3), 298-304. 1995.
  10. Circadian Technologies, Shiftwork Practices Survey 2002.
  11. Ala-Mursula et al. Employee control over working times: associations with subjective health and sickness absences. J. Epidemiol. Community Health 56(4),272-8. 2002.
  12. Beltzhoover M. Self-scheduling: an innovative approach. Nurs. Manage. 25(4),81-2. 1994.
  13. Bradley, Martin. Continuous personnel scheduling algorithms: a literature review. J. Soc. Health Syst. 2(2),8-23. 1991.
  14. Holtom et al. The relationship between work status congruence and work-related attitudes and behaviors. J. Appl. Psychol. 87(5),903-15. 2002.
  15. Moore-Ede M. The Twenty-Four Hour Society: Understanding Human Limits in a World that Never Sleeps. 1994.
  16. Smith PA et al. Change from slowly rotating 8-hour shifts to rapidly rotating 8-hour and 12-hour shifts using participative shift roster design. Scand. J. Work Environ. Health. 24(S3), 55-61. 1998.
  17. Teahan. Implementation of a self-scheduling system: a solution to more than just schedules! J. Nurs. Manag. 6(6),361- 81. 998. Erratum in: J. Nurs. Manag. 7(1),65. 1999.
  18. Sakai K et al. Educational and intervention strategies for improving a shift system: an experience in a disabled persons' facility. Ergonomics 36(1-3),219-25. 1993.
  19. International Classification of Sleep Disorders Diagnostic and Coding Manual, http://www.esst.org/adds/ICSD.pdf, page 343.
  20. Higgins, Laura; Fette Bernie (in press). "Drowsy Driving" (PDF). Retrieved 2013-06-12.
  21. Vyazovskiy, V. V., Olcese, U., Hanlon, E. C., Nir, Y., Cirelli, C., & Tononi, G. (2011). Local sleep in awake rats. Nature, 472(7344), 443-447.
  22. Ricci, J. A., Chee, E., Lorandeau, A. L., & Berger, J. (2007). Fatigue in the US workforce: prevalence and implications for lost productive work time. Journal of Occupational and Environmental Medicine, 49(1), 1-10.
  23. Katrin Uehli, Amar J. Mehta, David Miedinger, Kerstin Hug, Christian Schindler, Edith Holsboer-Trachsler, Jörg D. Leuppi, et al. (2014). Sleep problems and work injuries: A systematic review and meta-analysis. Sleep Medicine Reviews. doi:10.1016/j.smrv.2013.01.004
  24. Aguirre, A. Shiftwork Practices Survey, 2005.
Thursday, 13 November 2014 15:07

Lean Staffing: 3 Unfortunate Realities

In most 24/7 operations, there are a fixed number of positions to be filled on each shift. Because of this, staffing levels greatly impact overtime rates for employees.

Understaffing an operation requires employees to work additional hours originally allocated for off-duty activities, such as: rest, recovery, family activities, social events, and personal responsibilities.

While machines operate linearly, people do not. These off-duty activities are crucial for the emotional and physical well-being of the workers AND the bottom line of an operation.

Here are three reasons why lean staffing can be dangerous...

1. Staffing Levels are Related to Absenteeism Rates

Based on CIRCADIAN's 2014 Shiftwork Practices data, we found that the "leaner" operations (i.e. reduced staffing levels) reported higher absenteeism rates (Figure 1).

Interestingly, over 50% of all unscheduled absences are due to either: personal needs, stress, or an entitlement mentality (i.e. “I’ve earned it”) (Shiftwork Practices, 2014).

Figure 1. Staffing Levels & Absenteeism Rate

Absenteeism Rates & Staffing Levels


2. Fatigued Workers Cost More in Worker’s Compensation

As workers reallocate their off-duty time towards work, their fatigue levels often rise due to the additional labor and reduced sleep opportunity (Figure 2).

Figure 2. Overtime Levels & Fatigue Problems

 Shift Work Overtime & Fatigue

Fatigued workers exhibit up to 4x the worker’s compensation costs as compared to non-fatigued workers (Figure 3). A recent meta-analysis of 27 observational studies found that sleep problems increase the risk of workplace injuries by 62 percent (Uehli et al., 2014).

Figure 3. Fatigue Levels & Worker’s Compensation

shift workers compensation and fatigue levels

3. Stress & Fatigue are Productivity Killers

Severe stress and fatigue problems have been found to reduce worker productivity by up to 10% (Figure 4).

Stress and fatigue can be influenced by a variety of factors; however, operations with leaner staffing levels more frequently reported problems with severe stress and fatigue among shift workers than operations that were adequately staffed (Shiftwork Practices, 2014).

Figure 4. Reduction in Productivity as a Function of Stress & Fatigue*

Shift work stress fatigue productivity
The Conclusion…

It’s clear through this body of research that workload-staffing imbalances need to be addressed to reduce excess costs, safety incidents, and worker fatigue.

To learn more about analyzing your staffing level, download our free white paper:

Staffing Levels
Managing Risk in 24/7 Operations

24/7 operations staffing level white paper shift work white paper download
About CIRCADIAN®

CIRCADIAN® is the global leader in providing 24/7 workforce performance and safety solutions for businesses that operate around the clock. Through a unique combination of consulting expertise, research and technology, software tools and informative publications, CIRCADIAN helps organizations in the 24-hour economy optimize employee performance and reduce the inherent risks and costs of their extended hours operations.




Why should YOU be concerned about absenteeism?


On average, a shift worker in the U.S. costs a company roughly $2,660 in excess absenteeism costs each year.

Having trouble viewing our infographic? View it here: https://magic.piktochart.com/output/2598161-absenteeism

"How do I reduce employee overtime?"

The question "How do I reduce employee overtime?" is one of the most commonly asked questions when the subject of overtime is presented. To tackle the costs and associated problems of excessive overtime, managers must first understand why and where overtime arises in their operations.

Figure 1. Causes of Overtime from a Human Capital Perspective


Causes of Overtime

There are four potential scenarios (Figure 1 - from left to right) that cause overtime from a human capital perspective (overtime may also be caused by delivery backlogs, malfunctioning machines, etc.):

1. If overtime is high and the absence rate (a combination of absenteeism, vacancy due to turnover, and absences due to accidents and injuries) is low, then a facility/company either does not have a large enough staff to meet demand or the existing staff is not productive enough (perhaps due to presenteeism, low morale, working conditions or fatigue).

In some instances, the total staffing level may be appropriate, but the distribution of staff throughout the day, week or year may be incorrect, causing overcapacity at some points and overtime at others (a situation seen in many service industries). A flexible workforce management approach allows for a headcount to more efficiently match ever-changing demand levels.

2. If overtime and absence rates are high, then the excess overtime is increased by the absence rate. Reducing the absence rate may result in:

a) Finding that overtime is acceptable and that a facility is correctly staffed;

b) Finding that overtime is still too high and more employees (or more productive staff) are required;

c) Finding that overtime is very low and that a facility may be overstaffed.

3. If absence and overtime rates are low, then facility managers should ensure that staffing meets demand at all times of the day, week, and year. A detailed look at demand, minimum headcount, and vacation and absence policies can determine optimized staffing levels.

4. If overtime is low, but the absence rate is high, then it is likely that a facility is overstaffed to account for the absent employees—some companies must overstaff by 10% to 15% to account for absences on weekends.

Learn More about Overtime

Want to learn more about overtime? Interested in the ways in which overtime may be impacting your workers? Visit CIRCADIAN to download a free white paper that details optimal staffing levels in 24/7 operations.

About CIRCADIAN

CIRCADIAN® is the global leader in providing 24/7 workforce performance and safety solutions for businesses that operate around the clock.  Through a unique combination of consulting expertise, research and technology, software tools and informative publications, CIRCADIAN helps organizations with traditional and/or extended operating hours optimize employee performance and reduce the inherent risks and costs of sleep deprivation and fatigue.
Thursday, 07 August 2014 21:12

Overtime and the U.S. Work Week

Employees in the U.S. work the highest number of work hours per year compared to the rest of the world—about 70 more hours per year than workers in Japan, and 350 hours more than in Europe. Longer workweeks and fewer weeks of vacation in the U.S. combine to produce this discrepancy.

America is one of the few industrialized nations that does not mandate a minimum number of paid vacation days per year. No U.S. federal laws limit the number of hours that people can work or can be asked to work, except in a few select safety sensitive occupations (e.g. the transportation industry). This, combined with the lack of mandated vacation time, contributes to the high annual work hours of the average U.S. employee.

Average Hours of Work per Week

The traditional workweek in an office or other discrete operation in the U.S. is generally considered to be 9 a.m. to 5 p.m., Monday to Friday—40 hours of work. However, 40 hours per week did not become the standard until the early 1930s with the introduction of the National Industrial Recovery Act, the forebear of the Fair Labor Standards Act (FLSA).

In 2013, the Bureau of Labor & Statistics reported that the average hours of work per week in nonagricultural industries is 38.5 hours, with full time workers averaging 42.5 hour workweeks. Figure 1 shows the average hours worked each week by employees as broken down by industry.

Figure 1. Hours Worked Per Week Based on Industry

 

BLS Average Work HoursOvertime & Employees

Naturally, overtime is most applicable to employees who earn wages based on an hourly rate. Though the standard workweek as defined by the Fair Labor Standards Act is 40 hours of work, many hourly employees work in “extended hours” facilities that require at least some level of overtime from employees in order to run operations continuously.

The definition of overtime is not limited to hourly employees who, in the U.S., must be paid a premium for hours worked over 40 in a week. The definition also applies to salaried employees who are not required to receive extra compensation for the length of time they spend at work. These salaried workers are just as likely to work overtime, and are equally susceptible to the issues relating to overtime.

Scheduled vs Actual Hours Worked

Many managers attempt to reduce overtime as much as possible; however, unforeseen absenteeism often causes increases in overtime among shift workers. According to the Shift Work Practices 2014 report, which represents data from 341 industrial shift work operations, shift workers on average are scheduled for one hour of overtime per week; however, each shift worker tends to work five extra hours of overtime per week. Figure 2 graphically depicts the weekly scheduled versus actual number of hours work on average per shift worker.

Figure 2: Weekly Scheduled vs Actual Hours Worked per Shift Worker

 SWP 2014 - Weekly Work Hours Per Shift Worker

The discrepancy between scheduled vs actual hours worked is not surprising, especially among understaffed workforces. Operations that had ‘just enough’ or ‘not enough’ workers covering permanent positions had significantly higher absenteeism rates which results in unwanted increases in overtime for the rest of the workforce (Figure 3).

Figure 3: Absenteeism Rates of Operations based on Staffing Levels
Staffing Levels and Employee AbsenteeismDistribution of Overtime

If overtime is equally distributed across employees, up to approximately 12 percent overtime is an acceptable overtime rate for a workforce, based on Circadian’s research. Overtime varies not only by industry and company, but also by employee. For instance, our research indicates that, in many industries, 20 percent of the employees work 60 percent or more of the overtime (Figure 4).

As accidents and safety problems can be caused by one fatigued employee, the risk can increase as the distribution of overtime becomes more skewed. The imbalance exposes the pool of high overtime employees to extra health risks, and exposes the company to increased health care costs, absenteeism costs, safety issues, and legal liability.

Figure 4. Actual distribution of overtime at an extended hours facility.

  distribution of overtime at an extended hours facility.

Want to learn more about how to reduce overtime?

Interested in learning more about overtime levels across industries? Want to determine if your operation is functioning at an efficient staffing level?

Visit CIRCADIAN.com to learn more about reducing overtime, proportional staffing, and shift schedule optimization. Also, make sure to download a complimentary white paper from CIRCADIAN that focuses on optimal staffing levels.

About CIRCADIAN

CIRCADIAN® is the global leader in providing 24/7 workforce performance and safety solutions for businesses that operate around the clock.  Through a unique combination of consulting expertise, research and technology, software tools and informative publications, CIRCADIAN helps organizations with traditional and/or extended operating hours optimize employee performance and reduce the inherent risks and costs of sleep deprivation and fatigue.

The use of mandatory overtime often causes contention, but there are no federal rulings that prohibit its use, nor do laws prevent an employer from firing a person who refuses to work mandatory overtime. However, several states have outlawed mandatory overtime in health care professions.

How do shift work operations assign overtime?

Data from 341 North American shift work operations shows that:

  • 73% first asked for volunteers, and then used mandatory overtime if needed because of lack of volunteers.
  • 20% of facilities reported relying exclusively on voluntary overtime
  • 7% reported relying exclusively on mandatory overtime. 

Many workers, both salaried and hourly, who feel the pressure to deliver results or impress management end up working overtime voluntarily. Though this overtime is voluntary, it can often take a large toll on workers if it becomes a chronic work pattern, resulting in many of the same issues associate with mandated overtime.

A study at Cornell University revealed that employees who experience high levels of supervisory pressure to work overtime are 66% more likely to experience depression than those who have moderate to low supervisory pressure. In combination with the higher depression comes higher levels of stress, job-escape drinking problems, absenteeism, and multiple occurrences of injuries at work (only 9% of employees with no supervisory pressure to work overtime reported multiple occurrences of injuries, compared to 16% with high supervisory pressure).

Learn More about Overtime

Want to learn more about overtime? Interested in the ways in which overtime may be impacting your workers? Visit CIRCADIAN to download a free white paper that details optimal staffing levels in 24/7 operations.

About CIRCADIAN

CIRCADIAN® is the global leader in providing 24/7 workforce performance and safety solutions for businesses that operate around the clock.  Through a unique combination of consulting expertise, research and technology, software tools and informative publications, CIRCADIAN helps organizations with traditional and/or extended operating hours optimize employee performance and reduce the inherent risks and costs of sleep deprivation and fatigue.



Overtime can be beneficial for both employees and companies. It provides the company with the flexibility to cover unexpected absences and changes in demand without hiring more staff and it gives employees extra income at a premium rate.

However, overtime has its downsides too. While many employees will happily take as much overtime as is available, there is growing scientific evidence that relying too much on overtime can lead to numerous problems for an operation.

Below are five consequences to relying on excessive amounts of overtime:

#1 - Increased Health Problems

A considerable body of scientific work has explored the health problems associated with working excessive overtime. Some health problems that have been linked to long working hours include: 7-11

• Lower-back injury in jobs with a lot of manual lifting

• Higher blood pressure among white-collar workers

• Increased mental health issues

• Increase in total and lost workday injury rates

• Lower birth weight or gestational age in women

• Heavy alcohol consumption among men

• Higher suicide rates

A study by Cornell University shows that approximately 10% of employees who work 50 to 60 hours per week report severe work-family conflicts.12 This number jumps to 30% for those who work more than 60 hours. The divorce rate also increases as weekly hours increase. These factors contribute in turn to mental health and alcohol problems.

A Canadian study showed that workers who increased their work hours from 40 hours or less per week to over 40 hours per week experienced an increase in tobacco and alcohol consumption, an unhealthy weight increase among men, and an increase in depression among women. 13

These health problems contribute to the indirect costs of allowing excessive overtime to occur. Health care costs, absenteeism, and turnover will increase, while productivity will decrease.

#2 - Increased Safety Risk

Long work hours have been linked to increased safety risk in several studies (reviewed by

Rosa), including: 11

  • Safety and performance at nuclear plants
  • Impaired performance and lowered attention
  • An increase in errors in medical facilities
  • A threefold increase in accident rates after 16 hours of work

These additional safety problems are likely due to worker fatigue, which could be from a single long day or from the cumulative effect of multiple days of long hours. A German study showed that doctors who worked over 48 hours a week were five times more likely to have a driving accident (either while traveling to a call, or while commuting). 14

While working at night and during the early morning has been linked to an increased risk of transportation accidents, research also suggests that long work hours in themselves contribute to accident rates.15 As they become more fatigued, drivers become less cautious, execute more dangerous maneuvers, and exhibit more erratic driving patterns.

Circadian data from shift work operations (not just transportation operations) shows that companies with more fatigue-related problems are also likely to have higher rates of overtime (Figure 6), emphasizing the effect that longer work hours can have on sleep quantity and quality.

Figure 1. Level of fatigue-related workplace problems versus overtime level 3
Overtime  Fatigue

#3 - Decreased Productivity

Studies and reports suggest that productivity can suffer with increased overtime hours. In white-collar jobs, performance decreases by as much as 25% when 60 or more hours are worked in a week. 16 Any job not governed by a continuous process can be affected by decreased productivity, and even process-driven work can suffer if reject rates and customer dissatisfaction increase due to diminished quality and performance linked to long hours.

This performance decline is confirmed by the work of J. Nevison of Oak Associates. In his white paper, Nevison brings together scientific, business, and government data to demonstrate that little productive work takes place over and above 50 hours per week (Figure 2). Two other studies, also examined in the white paper, show that productive hours drop by an additional 10 hours when the number of consecutive long workweeks increases from four to 12, highlighting the cumulative effects that overtime can have.

Figure 2. Productive vs. actual work hours, from a collection of four studies16

 Overtime  Productivity

 

Data from 18 manufacturing industries in the U.S. shows that for most of these industries, productivity (measured as output per hour) declines when overtime is used.17 On average, a 10% increase in overtime results in a 2.4% decrease in productivity (more output is achieved, but the number of hours worked increases as well—not as much output per hour is realized).

The scientific literature gives the following reasons for the productivity limitations of longer and longer workweeks:

  • Fatigue—employees simply being too physically and mentally tired to perform at their best ability
  • As more time is provided or available to complete a task, work rate slows and unproductive time increases
  • Concerns over work/family balance and health problems may lead to presenteeism— where the employee is physically at work, but his or her mind is not on the job
  • If employees are working long workweeks simply to be seen “putting in the hours,” it is likely that these hours are less productive

In shift work operations, morale is lower in industries with higher overtime—companies with excellent to fair morale had overtime levels of 11.5% versus 15.5% in those with poor or very poor morale (Figure 3).3

Figure 3. Overtime and morale in a facility.3

Overtime  Morale 

#4 - Increased Absenteeism

Excessive overtime can lead to absenteeism as a result of poor health, fatigue, or people simply needing to take time off. Absences often need to be covered by replacement employees, often working overtime themselves, making the problem self-perpetuating.

Excessive overtime can also result in morale problems, which can be manifested as low productivity, absenteeism, turnover and labor issues. In Circadian’s Shiftwork Practices 2004, 31% of shift work companies with very high overtime levels (more than 10 hours per employee per week) had poor morale. Conversely, only 13% of companies with normal overtime amounts had poor morale. Morale was reflected in absenteeism levels: 54% of operations with high overtime also had absenteeism levels above 9%, compared with only 23% of operations with normal levels of overtime.

This is not to say that all absenteeism is a result of employee response to overtime—companies with high absenteeism will often use overtime to fill vacancies. However, it is likely that the problem is self-perpetuating to some degree.

#5 - Increased Turnover Rates

It follows that another adverse effect of excessive absenteeism will be increased turnover, as the lack of work-life balance and fatigue resulting from excessive overtime finally catch up with some employees. Again, as with absenteeism, companies with high turnover are also likely to have high overtime, as employees must work to make up for vacant positions if demand is to be met.

Turnover as a direct result of working excessive hours is more likely in non-hourly positions, where the employees are not being paid a premium to work the extra hours.

Solutions

While there are clearly a myriad of issues associated with employee overtime rates, there are a variety of ways to mitigate the negative effects of overtime. The proper solutions for managing overtime can vary based on industry, company size, work environment, and many other factors. It is key to recognize that overtime policies should be regularly assessed to determine their effectiveness.

Managing Overtime

To properly manage the direct and indirect costs associated with excessive overtime, employers should do the following:

• Reduce unscheduled absences by addressing the root cause(s) of them.

• Ensure staffing levels are appropriate and that they meet varying demand through the day, week, month and year.

• Review policies and procedures to ensure that they do not encourage excessive overtime.

• Take steps to increase productivity during the regular workweek.

Choosing Appropriate Level of Overtime

The appropriate level of overtime for a particular facility depends on a number of factors, including whether your employees must be paid an overtime premium, training and recruitment costs, safety and quality issues, and the cost of the benefits package.

Interested in learning more about overtime? Curious as to how overtime may be negatively impacting your current operations? Download our FREE white paper titled:

Staffing Levels

A Key to Managing Risk in 24/7 Operations
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CIRCADIAN® is the global leader in providing 24/7 workforce performance and safety solutions for businesses that operate around the clock.  Through a unique combination of consulting expertise, research and technology, software tools and informative publications, CIRCADIAN helps organizations in the 24-hour economy optimize employee performance and reduce the inherent risks and costs of their extended hours operations.

REFERENCES

  1. Bureau of Labor & Statistics. Current Employment Statistics. 2013.
  2. Circadian’s Shiftwork Practices 2002.
  3. Circadian’s Shiftwork Practices 2004.
  4. Circadian shift worker database.
  5. Van der Hulst M. Long Work Hours and Health. Scandinavian Journal of Work, Environment and Health 2003;29.
  6. A standard 12-hour schedule is not counted in this definition, as it is usual to work three or four days a week when working these schedules.
  7. Daltroy LH et al. A case-control study of risk factors for industrial low back injury: implications for primary and secondary prevention programs. Am Journal of Industrial Medicine 1991;20.
  8. Hayashi T et al.. Effect of overtime work on 24-hour ambulatory blood pressure. Journal of Occupational and Environmental Medicine 1996;38.
  9. Ettner SL, Grzywacz JG. Workers’ perceptions of how jobs affect health: a social ecological perspective. Journal of Occupational Health Psychology 2001;6.
  10. Lowery JT et al. Risk factors for injury among construction workers at Denver International Airport. American Journal of Industrial Medicine 1998 Aug;34.
  11. Rosa RR. Extended workshifts and excessive fatigue. Journal of Sleep Research 1995;4.
  12. Cornell University. Industrial and Labor Relations, Institute for Workplace Studies. Overtime and the American Worker.1999
  13. Shields M. Long Working Hours and Health. Health Reports, Autumn 1999; 11.
  14. Kirkaldy B et al. Working Hours, Job Stress, Work Satisfaction, and Accident Rates Among Medical Practitioners and Allied Personnel. International Journal of Stress Management 1997;4.
  15. Nevison J, Overtime Hours: The Rule of Fifty.
  16. Permission from Nevison, Oak Associates.
  17. Shepard E, Clifton T. Are Long Hours Reducing Productivity in Manufacturing. International Journal of Manpower 2000;7.

 

 

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