Workers Lose £28 Billion a Year to Unpaid Overtime, TUC Warns

Why It Matters

Unpaid overtime erodes earnings, wellbeing and productivity, while the Employment Rights Act could shift the balance toward fairer work practices across the UK economy.

Key Takeaways

• £28.5 billion lost to unpaid overtime in 2025.
• 3.5 million UK workers regularly work unpaid overtime.
• Average loss £8,100 per worker annually.
• Unpaid overtime represents 11.9% of UK workforce.
• Employment Rights Act strengthens protections against unpaid overtime.

Pulse Analysis

Unpaid overtime remains a hidden drain on the UK economy, with the TUC’s latest analysis revealing a £28.5 billion shortfall in 2025. The Labour Force Survey data underpinning the study shows that roughly one in eight employees regularly sacrifice an extra day’s worth of work each week without compensation. Beyond the direct financial hit, these extra hours fuel workplace stress, contributing to higher absenteeism and lower morale, which in turn depresses overall productivity.

The legislative response arrives via the Employment Rights Act, which received Royal Assent last December. By simplifying union recognition and mandating clear communication of workers’ rights, the Act equips employees with a more robust framework to contest unpaid overtime. Union leaders anticipate that stronger collective bargaining will deter exploitative practices, encouraging employers to align staffing levels with realistic workload expectations and to formalise overtime pay structures.

For businesses, the shift presents both a compliance challenge and an opportunity. Companies that proactively address unpaid overtime can improve employee wellbeing, reduce turnover, and boost efficiency. Conversely, firms that ignore the emerging standards risk reputational damage and potential legal disputes. As the UK labour market continues to evolve, monitoring overtime trends and aligning policies with the Employment Rights Act will be essential for sustaining a competitive, healthy workforce.