Reducing overtime requires strategic workforce planning, transparent time tracking, and a company culture that prioritizes work-life balance. In Germany, the Working Hours Act (Arbeitszeitgesetz) limits daily working time to 8 hours (maximum 10 with compensation) and mandates comprehensive documentation by employers. With targeted measures such as realistic project planning and flexible working models, HR professionals can systematically reduce overtime.

What Is Overtime?

Overtime refers to working hours that exceed the contractually agreed working time. Important to note: extra work only officially counts as overtime when the employer has ordered it or at least has knowledge of it. Employees who work on their laptop after hours without documenting it have no entitlement to compensation.

The Difference Between Overtime and Additional Work

In legal terms, these concepts are often used interchangeably, but there is a subtle difference. Overtime refers to exceeding the individually agreed working time (e.g., as per the employment contract). Additional work, on the other hand, means exceeding the statutory or collectively agreed maximum working hours. For HR professionals, this distinction is relevant because stricter legal regulations apply to additional work.

Overtime in Germany: Current Statistics

The reality in German companies shows that overtime is part of everyday working life for many employees. Current statistics provide a differentiated picture.

2024/2025 Statistics

According to the Federal Statistical Office (Destatis), nearly 4.4 million employees regularly worked more than contractually agreed in 2024. This corresponds to 11 percent of all employees. Men work overtime slightly more frequently at 13 percent compared to women at 10 percent.

The Institute for Employment Research (IAB) recorded a historic low for the third quarter of 2024: on average, each employee worked 3.3 paid and 3.9 unpaid overtime hours. Nevertheless, the total volume remains considerable – it corresponds to more than 750,000 full-time positions.

Industries with the Highest Overtime Rates

The distribution of overtime varies significantly across economic sectors:

• Finance and insurance industry: 17 percent with overtime
• Energy supply: 16 percent
• Hospitality industry: lowest rate at 6 percent

Trend: Time Accounts Instead of Payment

The type of overtime compensation has changed. Of employees with overtime, 71 percent use a working time account. Only 16 percent receive direct compensation, while 19 percent work unpaid overtime. This trend toward transitory overtime – meaning overtime that is later compensated with time off – has increased by 20 percentage points over the last three decades.

Legal Framework: The German Working Hours Act

The German Working Hours Act (Arbeitszeitgesetz, ArbZG) provides the legal framework for working hours in Germany. Knowledge of these regulations is essential for HR professionals.

Maximum Working Hours Under §3 ArbZG

Daily working time may not exceed 8 hours as a general rule. An extension to up to 10 hours is only permissible if an average of 8 hours per working day is not exceeded within six calendar months or 24 weeks. Based on a 6-day week, this results in a maximum weekly working time of 48 hours – in compliance with the EU Working Time Directive.

Mandatory Time Tracking Since 2022

With the ruling of the Federal Labor Court on September 13, 2022 (Case No. 1 ABR 22/21), the time tracking obligation for all employers was specified. Working hours must be recorded objectively, reliably, and accessibly. The previous requirement to document only overtime and Sunday work was significantly expanded.

Penalties for Violations

Violations of the Working Hours Act can be costly for employers. Administrative offenses can result in fines of up to 15,000 euros. Repeated or serious violations can lead to a work prohibition. Additionally, employees have the right to refuse unlawful work instructions.

Causes: Why Does Overtime Occur?

To sustainably reduce overtime, HR professionals must first understand the causes. The DGB Good Work Index provides insightful findings.

Work Intensification and Time Pressure

The DGB analyses show a clear correlation: the more pronounced work intensification and time pressure are, the more frequently overtime is worked. With strong work intensification, the proportion of those working more than five overtime hours per week increases from 18 to 38 percent. When employees feel rushed at work, this proportion nearly doubles.

Staff Shortages

When too much work rests on too few shoulders, overtime is the logical consequence. Missing personnel capacity due to the skilled worker shortage exacerbates this problem in many industries.

Inefficient Processes

Time wasters in everyday work – from unnecessary meetings to outdated workflows – lead to employees being unable to complete their core tasks during regular working hours. Contradictory requirements and frequent interruptions also drive up overtime.

Remote Work Specifics

An often underestimated factor: according to the DGB, 52 percent of employees working from home regularly work overtime. Among employees without remote work, it's only 31 percent. The separation between working time and leisure time apparently proves more difficult within one's own four walls.

Reducing Overtime: 7 Measures for HR

With a well-thought-out strategy, HR professionals can systematically reduce overtime. The following measures have proven effective in practice.

1. Optimize Workforce Planning

Timely hiring of sufficient personnel prevents overtime from becoming a permanent state. Regularly check whether personnel capacity matches the workload. During peak times, external employees or temporary workers can provide short-term relief.

2. Implement Time Tracking

Without transparent recording of all working hours, the basis for effective overtime management is missing. Digital time tracking systems create clarity and enable early intervention before overtime accumulates.

3. Realistic Project Planning

Many overtime hours result from unrealistic deadlines and incorrect assessments of staffing needs. Careful planning with buffers for the unexpected prevents this.

4. Adapt Company Culture

When overtime is seen as a sign of commitment, the problem is systematically reinforced. A company culture that values work-life balance and doesn't view punctual end of work as a weakness is key to sustainable reduction.

5. Flexible Working Models

Flextime, trust-based working hours, or part-time options can help better balance work and private life. Important: time tracking must also be ensured with flexible models.

6. Sensitize Managers

Managers have a role model function. If they regularly work overtime themselves, it signals to the team that extra work is expected. Training can help create awareness of the issue.

7. Regular Monitoring

Establish a system for continuous monitoring of overtime trends. Monthly reports and early warning systems make it possible to identify trends early and take corrective action.

Overtime Reduction: Time Off or Payment?

When overtime has accrued, the question of compensation arises. Both options have their advantages and disadvantages.

Advantages and Disadvantages

Time off in lieu offers the advantage that employees receive additional recovery time – without the compensation being taxed. For many employees, this benefit outweighs payment. Additionally, time off in lieu is easier on the employer's budget.

Payment is useful when time off is not operationally possible or upon termination of employment. Note: additional compensation is subject to tax and social security contributions.

Legal Regulations

In principle, it is up to the employer to determine whether overtime is compensated with time off or payment. Employment or collective agreements may provide for different arrangements. Important: without a corresponding agreement, the statutory limitation period for overtime claims is three years under §195 of the German Civil Code (BGB). Contractual exclusion periods (minimum three months) can shorten this period.

Working Time Account as a Solution

A working time account enables flexible management of plus and minus hours. Overtime flows into the account and can later be taken as time off. This model has become established: 71 percent of employees with overtime use such an account, according to Destatis.

Frequently Asked Questions About Overtime

How much overtime is legally permitted?

The Working Hours Act provides for a maximum daily working time of 8 hours. An extension to up to 10 hours is possible if compensation occurs within 6 months. The weekly maximum limit is 48 hours according to the EU Directive.

Must overtime be paid?

The compensation of overtime is not regulated by law. The provisions in the employment or collective agreement are decisive. Alternatives to payment are time off in lieu or credit to a working time account. In the absence of regulations, industry-standard compensation applies under §612 of the German Civil Code (BGB).

Can the employer order overtime reduction?

Yes, if this is regulated in the employment contract, collective agreement, or works agreement. However, the employer must announce the reduction in good time and weigh operational interests.

When does overtime expire?

The statutory limitation period is three years under §195 BGB. Contractual exclusion periods can reduce this period to a minimum of three months. Upon termination, overtime must either be reduced during the notice period or paid out.

Is time tracking mandatory?

Yes, since the Federal Labor Court ruling of September 13, 2022, employers are obligated to record all working hours. Documentation must be objective, reliable, and accessible.

How do I reduce overtime in remote work?

Define clear availability times and ensure digital time tracking also takes place when working from home. Regular check-ins on workload help identify problems early. The DGB Index shows: 52 percent of remote workers work overtime – significantly more than the 31 percent in the office.

Which industries have the most overtime?

According to data from the Federal Statistical Office from 2024, the finance and insurance industry leads with 17 percent, followed by energy supply at 16 percent. The hospitality industry has the lowest rate at 6 percent.

Conclusion

Reducing overtime is not a one-time measure but a continuous process. The key lies in the combination of transparent time tracking, strategic workforce planning, and a company culture that takes work-life balance seriously. The legal requirements of the Working Hours Act set the framework – compliance not only protects employee health but also protects the company from legal consequences.

Current statistics make clear: the trend is toward working time accounts and time off in lieu rather than payment. For HR professionals, this means implementing appropriate systems and monitoring them regularly. Those who actively address the causes of overtime – from work intensification to inefficient processes – create the basis for sustainable improvement.

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Sources

• Arbeitszeitgesetz (ArbZG) [German Working Hours Act]. Federal Ministry of Justice, 2024. https://www.gesetze-im-internet.de/arbzg/
• Press Release: 4.4 million employees worked overtime in 2024. Federal Statistical Office (Destatis), July 2025. https://www.destatis.de/DE/Presse/Pressemitteilungen/2025/07/PD25_N038_13.html
• IAB Working Time Calculation Q3/2024. Institute for Employment Research, 2024. https://iab.de/daten/iab-arbeitszeitrechnung/
• DGB Good Work Index Compact 02/2025: Overtime – Less is More. German Trade Union Federation, 2025. https://index-gute-arbeit.dgb.de/
• Federal Labor Court Ruling on Time Tracking Obligation. Federal Labor Court, September 13, 2022. Case No. 1 ABR 22/21.
• Working Hours Act: Maximum Working Time, Breaks, Overtime. ver.di, 2024. https://www.verdi.de/themen/arbeit/