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Wages, Hours, and Overtime Premia: Evidence from the British Labor Market

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  • David N. F. Bell
  • Robert A. Hart

Abstract

Unlike the United States, Britain has no national laws regulating overtime hour assignment or compensation. Using individual-level data on male non-managerial workers from the 1998 British New Earnings Survey, the authors investigate relationships among the standard hourly wage rate, hourly earnings (including overtime), the overtime premium, and the length of overtime hours. They find that when overtime is accounted for, average hourly wage earnings are fairly uniform across firms in a given industry, because firms paying below-market-level straight-time wages tend to award above-market-level overtime premiums, and, conversely, firms paying above-market-level straight-time wages provide below-market-level overtime premiums.

Suggested Citation

  • David N. F. Bell & Robert A. Hart, 2003. "Wages, Hours, and Overtime Premia: Evidence from the British Labor Market," ILR Review, Cornell University, ILR School, vol. 56(3), pages 470-480, April.
    • Handle: RePEc:sae:ilrrev:v:56:y:2003:i:3:p:470-480
    DOI: 10.1177/001979390305600306
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    Cited by:

    1. Daniel Schaefer & Carl Singleton, 2020. "Nominal Wage Adjustments and the Composition of Pay: New Evidence from Payroll Data," Economics Discussion Papers em-dp2020-01, Department of Economics, University of Reading.
    2. HASEBE Takuya & KONISHI Yoshifumi & SHIN Kong Joo & MANAGI Shunsuke, 2018. "White Collar Exemption: Panacea for long work hours and low earnings?," Discussion papers 18002, Research Institute of Economy, Trade and Industry (RIETI).
    3. Hart, Robert A. & Ma, Yue, 2010. "Wage-hours contracts, overtime working and premium pay," Labour Economics, Elsevier, vol. 17(1), pages 170-179, January.
    4. Ronald L. Oaxaca & Galiya Sagyndykova, 2020. "The effect of overtime regulations on employment," IZA World of Labor, Institute of Labor Economics (IZA), pages 1-89, December.
    5. Takahashi, Katsuhide & Urata, Shujiro, 2010. "On the Use of FTAs by Japanese Firms: Further Evidence," Business and Politics, Cambridge University Press, vol. 12(1), pages 1-15, April.
    6. Pedro S. Martins, 2016. "Can overtime premium flexibility promote employment? Firm-and worker-level evidence from a labour law reform," Nova SBE Working Paper Series wp607, Universidade Nova de Lisboa, Nova School of Business and Economics.
    7. Sachiko Kuroda & Isamu Yamamoto, 2009. "How are hours worked and wages affected by labor regulations?: The white-collar exemption and 'name-only managers' in Japan," Keio/Kyoto Joint Global COE Discussion Paper Series 2009-008, Keio/Kyoto Joint Global COE Program.
    8. Hart, Robert A. & Ma, Yue, 2013. "Overtime Working and Contract Efficiency," IZA Discussion Papers 7560, Institute of Labor Economics (IZA).
    9. Dante Contreras & Roberto Gillmore & Esteban Puentes, 2017. "Self‐Employment and Queues for Wage Work: Evidence from Chile," Journal of International Development, John Wiley & Sons, Ltd., vol. 29(4), pages 473-499, May.
    10. Kuroda, Sachiko & Yamamoto, Isamu, 2012. "Impact of overtime regulations on wages and work hours," Journal of the Japanese and International Economies, Elsevier, vol. 26(2), pages 249-262.
    11. Bell, David N.F. & Hart, Robert A., 2019. "The Decline of Overtime Working in Britain," IZA Discussion Papers 12651, Institute of Labor Economics (IZA).
    12. Sagyndykova, Galiya & Oaxaca, Ronald L., 2019. "Raising the Overtime Premium and Reducing the Standard Workweek: Short-Run Impacts on U.S. Manufacturing," IZA Discussion Papers 12557, Institute of Labor Economics (IZA).
    13. Eden,Maya, 2016. "The week," Policy Research Working Paper Series 7598, The World Bank.
    14. Martins, Pedro S., 2017. "Economic effects of overtime premium flexibility: Firm- and worker-level evidence from a law reform," GLO Discussion Paper Series 102, Global Labor Organization (GLO).

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