|Lost Labor Efficiency Due to Overtime Fatigue
|When most contractors are forced by delays, disruptions, or interferences to work their labor force on an overtime schedule,
they usually see only the premium wages and burden paid as the "extra cost."
Only about one contractor in 10 is thoroughly familiar with the real added cost of working manual labor forces on an extended
overtime schedule. What is worse, only about one owner or owner’s design professional in 100, maybe 50, recognizes and
understands the problem.
A manual laborer who works 50 hours per week can be anywhere from 5% to 35% less efficient and productive than a manual
laborer who works a 40-hour week. Whether the inefficiency is 5% or 35%, or something in between, it is a direct result of the
number of consecutive 50-hour weeks the manual laborer actually works.
For a 60-hour week, the manual labor inefficiency rate and range rises to 10% to 50%, when compared to a 40-hour week.
The most important thing to remember is when a manual laborer works overtime on a scheduled, consecutive basis week after
week, that worker’s efficiency steadily declines each successive week, beginning from week one and continuing through week
10 where it usually, but not always, reaches its lowest level and stays there in weeks 11, 12, and beyond.
A 70- or 80-hour manual labor work week, when worked on a consecutive weeks basis, is an absolute productivity disaster!
A second important thing to note about a manual laborer working in an overtime mode for many consecutive weeks is the fact
that all of the hours worked are affected by the overtime hours worked. Working 50 hours a week doesn’t just cause a manual
laborer to work 10 inefficient hours per week. All 50 hours are antiproductive.
Thus, by the time the 50-hour week has been worked for four consecutive weeks, the increased production of 10 extra work
hours performed per week is negated completely by the 20% in lost efficiency caused by overtime fatigue:
50 hours x 20% = 10 hours (loss)
From a cost standpoint, the premium wages and burden paid on 10 hours of overtime worked per week in the fourth week is
also an absolute loss. The bottom line is that consecutive weeks of overtime work for manual labor is a bad idea, especially
beyond the third consecutive week worked.
Several years ago, Meglan, Meglan & Company, Limited was asked to study a concrete form operation that was over budget
more than 100%. After examining the payroll and productivity records, a linear regression analysis was conducted using the
average overtime hours worked per week per worker and the average hourly productivity per worker as the two variables. The
results were interesting but somewhat inconclusive.
Then, a third variable was added—the number of consecutive weeks of high overtime hours per week worked. A multiple
regression analysis was conducted. Here’s a summary of the findings:
For a 40-hour week, the average manual laborer placed 10.4 square feet of concrete forms per hour, complete in place and
ready to pour. After seven 84-hour work weeks (seven consecutive days of work at 12 hours per day ), the average manual
laborer placed 3.3 square feet of concrete forms per hour, complete in place and ready to pour. That’s a 70% loss of
productivity! To label the results as "inefficient" is a major understatement.
Moreover, through 10 weeks of seven-day work weeks (12-hour work days), the owner and its construction manager were
threatening to terminate the contractor if it dared to give its work crew a day off or cut back the overtime.
The ironic part of this story is that it’s true, and that both the owner and the CM were members and participants in The
Business Roundtable’s Construction Industry Cost Effectiveness Project. This effort was led by a credible task group that was
one of the first to quantify overtime fatigue losses and warn the construction industry and users of the massive efficiency
losses caused by working too many consecutive weeks of scheduled overtime.
For more information on the effects of scheduled overtime on manual labor productivity, contact BRT’s Construction Division,
the Mechanical Contractors Association of America, or other major national trade associations. These organizations have
excellent study reports on productivity issues, supported with tabular and graphical statistics.
Construction Claims Topics serve as guidance documents only and are written for the expressed purpose of helping
construction industry executives and supervisors learn better ways of identifying the sources and causes of
construction claims and preventing disputes.
|# # #
© Copyright 2014 • Meglan, Meglan & Company, Limited • Columbus, Ohio