Overtime maintenance cost: the most expensive way to get work done

A maintenance manager looks at the monthly payroll and notices the overtime line has been creeping up for three months straight. Each individual week seemed reasonable, a turnaround here, an urgent repair there. But stacked together they paint a picture of a workforce that is either structurally under-resourced or chronically reactive.

Overtime is the most expensive way there is to get maintenance work done. Tracking it as a share of total labour cost keeps that expense visible, and creates the pressure to understand what is really driving it.

What it actually measures

Overtime maintenance cost is the cost of overtime labour divided by total maintenance labour cost, as a percentage. Overtime covers any hours worked beyond the standard period, usually eight hours a day or forty a week, paid at the overtime rate. It includes production incentives but not profit sharing, covers both routine operations and outages, and includes labour for end-of-life asset replacements; temporary contractor overtime is normally left out.

How to work it out

Overtime maintenance cost (%) = (Overtime labour cost ($) × 100) / Total maintenance labour cost ($)

In a month with $13,800 of overtime against $260,000 of total maintenance labour cost:

Overtime maintenance cost = ($13,800 × 100) / $260,000 = 5.3%

Just over the best-in-class threshold, this month is borderline. If the same figure repeats for three months running, it is time to ask what is really going on.

Why it is a symptom, not a disease

The temptation with overtime is to treat the number itself as the problem and attack it directly, capping hours, refusing call-outs. That usually just moves the pain around, because overtime is rarely the disease; it is the symptom. A persistently high figure almost always means one of three things: the workforce is under-staffed for the workload it carries, too much work is arriving unplanned and urgent, or the shift structure is misaligned with when maintenance is actually needed. There is also a cost that never reaches the overtime line at all. Tired people make more mistakes, and sustained overtime is a documented contributor to human error in maintenance: fatigue degrades the quality of the work, which seeds rework and, at the sharp end, safety incidents. It is telling that chronic overtime tends to travel in company with rising rework and injury rates, all of them symptoms of the same overstretched system. The expensive overtime hours, in other words, often buy work that is also more likely to be wrong.

What good looks like

The best-in-class target is less than five per cent of total maintenance labour cost. But the single most useful refinement is to stop reading overtime as a department average and start reading its distribution, because the average hides the real risk. A tidy five per cent spread evenly across the team is a very different thing from the same five per cent piled almost entirely onto a handful of people working punishing weeks month after month. That concentration is where the fatigue, the errors and the burnout actually live, and the percentage on its own will never show it. Always ask not just how much overtime, but who is working it.

Where it can mislead you

• Turnarounds and shutdowns spike overtime legitimately. Separate routine overtime from turnaround overtime before drawing any conclusion about structural staffing.
• If a permanent on-site contractor regularly works overtime, include their cost in both the top and bottom of the fraction for consistency.
• Check the distribution, not just the average. Overtime concentrated on a few individuals is a fatigue and safety risk that a healthy-looking percentage will completely conceal.
• Read it as a trend. One heavy month means little; three in a row means something structural.

Overtime maintenance cost above five per cent of labour spend is one of the more reliable signals that something structural needs attention, whether that is staffing levels, the quality of planning, or the reliability of the equipment itself. The overtime is just the bill; this metric is what makes you go looking for the cause, and the fatigue behind it is reason enough to look promptly.