The Indian construction industry is a major player contributing to the economy’s growth. At the center of the focus of the government’s initiatives to create world-class infrastructure in a time-bound manner, the construction industry is poised to receive investments of up to $1.4 trillion by 2025.
Without a doubt, the construction industry is crucial to driving the country’s growth, but it needs some reforms too. The industry is the second-largest employer, with over 51 million workers. Furthermore, the construction industry created 45 million additional jobs directly or indirectly. It is easy to anticipate that there certainly will be management challenges with such a large workforce.
In this article, we will focus on overtime in the construction industry. We will take a look at the challenges and available solutions.
Table of Contents
What are the construction industry overtime rules?
As the construction industry primarily has a workforce working at sites, time management is a complicated task to achieve. Keeping track of workers is a gigantic task.
It is important to understand what laws govern and protect workers’ rights in the context of overtime. Here are the essential labor laws an employer must be aware of.
|Act||Provisions under the Act|
|Factories Act, 1948 Sec. 51, 54 to 56 & 59 of the Act include overtime wages.||Under section 59 of the Factories Act, it is clearly instructed that a worker who works for more than 9 hours any day or for more than 48 hours in a week will be entitled to receive wages in respect to overtime work at the rate of twice his/her ordinary rate of wages.|
|Minimum Wages Act, 1948||It also applied to construction workers. According to section 33 of the Minimum Wages Act, overtime wages must be twice the rate of the ordinary wages of the worker. Sec. 14 of the Act states that for workers, if the minimum rate of wages is fixed by the time period, such as by the hour, by the day, or by any such period, and if any worker works more than that number of hours, it will be considered overtime.|
|Contract Labour (Regulation & Abolition) Act, 1970||As per Rule 79 of the Act pertains to the law regarding overtime calculation for contract workers. According to the act, every contractor must maintain a Register of Overtime in Form XXIII. All important details like the employee's name, overtime calculation, hours of extra work, etc., must be recorded in the register.|
|Building and Other Construction Workers (Regulation of Employment Service) Act, 1996||Under Section 28 & 29 of the Act, it is mentioned that construction workers who work overtime as per the regulations mentioned above must be remunerated at the rate of twice the ordinary rate of wages.|
Companies struggling with managing overtime for construction workers can end up with losses. As the law requires to pay twice the ordinary wage rate, overtime can have substantial financial liabilities. Let’s explore some measures to control overtime in the construction industry.
6 Tips to manage overtime in the construction industry?
1. Identify the issue
If unexplained overtime is reported in the company, it is essential to know why it is happening before resolving the issue. Overtime construction can result from several problems such as heavy project loads, poor time management, and staffing shortage. These are some of the issues on the management site.
Audit the HR and managers’ logs to understand the staffing and work distribution. It is also not uncommon in the construction industry to find employees working overtime for the extra pay. You have to get a clear idea of the issues to decide how to manage overtime for construction workers.
2. Be aware of local overtime laws
The central government of India implements the labor laws we have listed above, but there are specific local labor laws that a company must be aware of.
For example, Maharashtra has tweaked the local labor law to allow longer working hours and overtime periods for workers. As per the rule, “With the exemption from Sections 51,52, 54, and 56, employers can allow labourers to work in two shifts of 12 hours each.”
3. Track work hours with GPS construction time tracking software
As mentioned above, tracking employees’ working hours is a significant challenge in the construction industry. Field workers are away from CCTVs, so there is no sure way to know if they are working or not.
Using GPS-enabled attendance systems, you can overcome this challenge. Truein is a face recognition attendance system with geofencing and GPS tracking features. It can be used to record overtime for construction workers through the app on their smartphones.
4. Cross-train employees
The skill gap is a problem that increases over time in the construction industry. If you do not have the workers with the required skills, it can slow down productivity. Also, if the company is understaffed, project tasks can take longer to complete. The solution lies in cross-training employees to take up multiple roles if there is demand.
5. Hire contractors
Building on the above issue, if the overtime construction does not seem to stop even after cross-training workers because of staff shortage, you need to hire contractors. Hiring an independent contractor workforce can compensate for the deficit, and the overtime can be eliminated.
6. Improve work allocation and management
If the HR managers regularly cram overtime at the end of projects, it indicates poor time management. When you fail to anticipate the project’s timeline or resources, which will be required at the initial stages, the task becomes hard to manage as the deadline arrives.
The managers must spread out hours from the beginning of the project so that no overtime occurs later.
Unmanaged overtime in the construction industry can be a real nuisance. It can create revenue overheads that reduce the profits, but more importantly, it can take a toll on employee productivity and health. With efficient employee tracking software for construction idustry like Truein, unnecessary overtime can be eliminated and boost the company’s efficiency.