A R easo n ab le M ethod

to E stim a te Lo ss of
La b o r P ro d u ctiv ity
D ue to O v e rtim e

Rod C. Carter, CCP, PSP

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L ong I ntern ation al

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 L ong I n tern atio n al

A Reasonable Method to Estimate Loss of

Labor Productivity Due to Overtime
R o d C . C a r te r , C C P , P S P

Table of Contents

1. I N T R O D U C T I O N ................................................................................................................................................................................1

2. T H E M C A A B U L L E T I N ............................................................................................................................................................... 1

3. D E S C R I P T I O N O F T H E M E T H O D .....................................................................................................................................2

4. A D V A N T A G E S A N D D I S A D V A N T A G E S ....................................................................................................................... 7

List of Tables
T a b le 1 P ro d u ctiv ity In d ic e s fro m th e M C A A ’ s B u lle tin N o . O T 1 R e v i s e d .......................................................... 3

T a b le 2 E x a m p le T a b le - In e ffic ie n t H o u rs fo r O n e W o r k e r in a S ix -W e e k P e r io d ........................................... 4

T a b le 3 E x c e r p t fro m th e L o o k u p T a b l e ...................................................................................................................................... 6

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A Reasonable Method to Estimate Loss of

Labor Productivity Due to Overtime
1. INTRODUCTION

In t h e c o n s t r u c tio n in d u s try , i t is la r g e ly a g r e e d th a t o v e r t im e w o r k a d v e r s e ly a f f e c t s la b o r
p r o d u c tiv ity . H o w e v e r , th e r e is n o u n iv e r s a lly a c c e p te d m e th o d f o r e s t im a t in g th e r e s u ltin g lo s s o f
p r o d u c tiv ity , a n d m a n y o f th e s tu d ie s c o m m o n ly u s e d t o e s t im a t e s u c h lo s s e s h a v e b e e n s u b je c t to
c r it ic i s m b y in d u s tr y e x p e r ts a n d th e c o u rts .

T h i s a r t ic le d e s c r ib e s a d e ta ile d m e th o d f o r e s t im a t in g p r o d u c tiv ity lo s s e s r e tr o s p e c t iv e ly , i.e ., a f te r

th e h o u rs have been in c u r r e d . The p ro p o sed m e th o d u ses th e p r o d u c tiv ity lo s s e s fr o m
an M C A A B u lle tin p u b lis h e d in 2011, in w h ic h th e M C A A a v e r a g e d th e r e s u lts f r o m fo u r
w e ll- k n o w n o v e r t im e s tu d ie s . U s i n g th is m e th o d , o n e a p p lie s th e M C A A ’ s p r o d u c tiv ity f a c t o r s to
th e a c tu a l h o u r s o n a w e e k - b y - w e e k , w o r k e r - b y - w o r k e r b a s i s to e s t im a t e in e f f i c i e n t h o u rs . A m o n g
its s e v e r a l a d v a n ta g e s , t h e m e th o d a r e l a t i v e l y t i m e a n d c o s t - e f f e c t i v e w a y o f p r o v id in g d e ta ile d
r e s u lts , a s it c a n b e u s e d t o s h o w t h e i n e f f i c i e n t h o u r s f o r a g iv e n w o r k e r o r c r e w , o r t h e
i n e f f i c i e n t h o u r s in a g iv e n w e e k o r t im e f r a m e .

T h e S e c t i o n s b e l o w in c lu d e a b r i e f in tr o d u c tio n t o t h e M C A A B u l le t i n , a d e s c r ip tio n o f t h e
p ro p o s e d m e th o d in c lu d in g t h e s te p s in v o lv e d w ith s e ttin g u p t h e E x c e l m o d e l, a n d t h e a d v a n ta g e s
a n d p o te n tia l d is a d v a n ta g e s o f e m p lo y in g th is m e th o d .

2. THE MCAA BULLETIN

I n 2 0 1 1 , t h e M e c h a n i c a l C o n t r a c t o r s A s s o c i a t i o n o f A m e r ic a , I n c . ( M C A A ) p u b lis h e d B u l l e t i n
N o . O T 1 R e v i s e d , ti t l e d " H o w t o E s t i m a t e th e I m p a c t s o f O v e r t im e o n L a b o r P r o d u c t iv i t y .”
In its B u l l e t i n , t h e M C A A d id n o t p r o v id e a s tu d y b a s e d u p o n n e w o v e r t im e p r o d u c tiv it y lo s s
d a ta , b u t r a t h e r it a n a ly z e d a n d s u m m a r iz e d t h e d a ta f r o m f o u r e x i s t i n g s t u d ie s :1

• “ S c h e d u le O v e r tim e E ffe c ts on C o n s tr u c tio n P r o je c t s ,” p u b lis h e d by th e

B u s i n e s s R o u n d ta b le ( B R T ) in 1 9 8 0 ;

• “ O v e r t im e and P r o d u c tiv ity in E le c t r ic a l C o n s tr u c tio n ,” p u b lis h e d by th e

N a tio n a l E le c t r ic a l C o n tr a c to r s A s s o c ia t io n ( N E C A ) in 1 9 8 9 ;

• “ S c h e d u le O v e r t im e a n d L a b o r P r o d u c tiv ity : Q u a n tita tiv e A n a l y s i s ,” p u b lis h e d

b y D r . H . R a n d o lp h T h o m a s ( T h o m a s ) , e t a l, o f P e n n S t a te U n iv e r s ity in 1 9 9 7 ;
and

• “M o d ific a tio n Im p a c t A n a ly s is G u i d e ,” P u b lic a tio n N o. EP 4 1 5 0 -1 -3 ,

p u b lis h e d in 1 9 7 9 b y t h e U . S . A r m y C o r p s o f E n g i n e e r s ( C O E ) .

1 See “How to Estimate the Impacts o f Overtime on Labor Productivity,” MCAA Bulletin No. OT1 Revised, 2011, p. 3.

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A Reasonable Method to Estimate Loss of

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R e g a r d in g t h e s e f o u r s tu d ie s , t h e M C A A w r o te :

“T h ese studies hav e b e e n in u se in the construction industry f o r m any y e a r s a n d

hav e b e e n g e n e ra lly a c c e p t e d a s relia b le m ea su re s o f lost p rod uctivity d u e to
u n p la n n e d e x t e n d e d overtim e. E a c h h a s its stren gth s a n d w eakness, in clu d in g
criticism s r a n g in g f r o m the use o f lim ited data s o u rc e s to the w ithdraw al o f
rep o rts f r o m p u b lica tio n . H ow ever, the b a selin e data in any o f these studies have
n e v e r b e e n p r o v e n to b e in a ccu ra te. M o reo v er, the c o n cep t that a c o n t r a c t o r ’s
w o rk f o r c e b e c o m e s less efficien t a s u n p la n n e d e x ten d e d overtim e is w o rk e d is
g e n e ra lly r e c o g n iz e d a n d h a s n e v e r b e e n d isp ro v ed a s a n u n d erly in g f a c t . ” 2

T h e M C A A a ls o c it e d f o u r c a s e s in w h ic h U . S . C o u r ts a n d B o a r d s a c k n o w le d g e d an d / or a llo w e d
t h e s tu d ie s t o b e u s e d a s a b a s i s f o r q u a n t if y in g p r o d u c tiv it y lo s s e s d u e t o o v e r tim e .

T h e M C A A th e n p r o v id e d a s e r ie s o f c h a r ts f o r e a c h r e le v a n t w o r k w e e k ( 5 0 h o u r s p e r w e e k ,
a p p r o x im a te ly 5 5 h o u r s p e r w e e k , 6 0 h o u r s p e r w e e k , e t c .) . E a c h c h a r t s h o w s t h e r e s u lts o f th e
a p p l ic a b le s tu d ie s in te r m s o f t h e P r o d u c t iv i t y I n d e x a s a f u n c t io n o f t h e d u r a tio n o f s c h e d u le d
o v e r t im e . B e tw e e n one and fo u r s tu d ie s w ere c h a r te d , d e p e n d in g upon th e w o rk w eek .
F o r e x a m p l e , t h e c h a r t f o r t h e 5 0 - h o u r w o r k w e e k in c lu d e s d a ta f r o m a ll f o u r s tu d ie s ( B R T ,
N E C A , T h o m a s , a n d C O E ) , 4 w h il e t h e c h a r t f o r t h e 8 4 - h o u r w o r k w e e k in c lu d e s d a ta f r o m
N E C A ’ s s tu d y a l o n e ,5 a s t h e o th e r s tu d ie s d id n o t e v a lu a t e th e im p a c t s o f a n 8 4 - h o u r w o r k w e e k .

I n th e b a l a n c e o f it s B u l l e t i n , t h e M C A A p r o v id e d a t a b l e s u m m a r iz in g it s r e s u lts ( d i s c u s s e d
b e l o w ) , a n d e x p la in e d a n d g a v e e x a m p l e s o f t h e p r o s p e c t iv e a p p lic a t io n a n d th e r e t r o s p e c t iv e
a p p lic a t io n o f it s P I s t o e s t im a t e p r o d u c tiv it y l o s s . W h i l e t h e m e th o d p r o p o s e d in t h i s a r t i c l e is
g e n e r a lly c o n s i s t e n t w ith t h e s i m p le e x a m p l e o f th e r e t r o s p e c t iv e a p p lic a t io n p r o v id e d in th e
B u l l e t i n , i t is a f a r m o r e d e t a ile d a p p r o a c h .

3. DESCRIPTION OF THE METHOD

T a b l e 1 b e l o w is a r e c r e a t e d v e r s io n o f t h e M C A A ’ s r e s u lts t a b l e . 6 T h e r e s u lt s in d i c a t e th a t th e
P r o d u c t iv i t y I n d e x ( P I ) , a n d t h e r e f o r e a c t u a l w o r k e r p r o d u c tiv it y , d e c r e a s e s b o t h a s th e w e e k l y
h o u r s in c r e a s e a n d a s t h e d u r a tio n o f o v e r t im e w o r k is e x te n d e d . F o r e x a m p l e , g iv e n a 5 0 - h o u r
w o r k w e e k , t h e t a b l e in d i c a t e s th a t t h e f i r s t w e e k o f o v e r t im e r e s u lts in a P I o f 0 . 9 5 , o r a 5 % lo s s
o f p r o d u c tiv it y , w h il e t h e te n th c o n s e c u tiv e w e e k o f o v e r t im e r e s u lt s in a P I o f 0 .7 2 , or
a 2 8 % l o s s o f p r o d u c tiv it y . F o r a 6 0 - h o u r w o r k w e e k , t h e P I s a r e 0 . 9 1 ( 9 % l o s s ) in f i r s t w e e k

3 Id. at p. 16, footnote 6.

4 Id. at p. 6.
5 Id. at p. 8.

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A Reasonable Method to Estimate Loss of

Labor Productivity Due to Overtime
a n d 0 .6 1 (3 9 % lo s s ) in th e te n th w eek, or m o re e x te n s iv e lo s s e s th a n th e c o m p a r a b le
5 0 -h o u r w o rk w eek s.

Table 1
Productivity Indices from the MCAA’s Bulletin No. OT1 Revised

W eek of
Extended 50 54-56 60 63 70-72 84
OT hrs/wk hrs/wk hrs/wk hrs/wk hrs/wk hrs/wk
1 0.95 0.94 0.91 0.89 0.86 0.75
2 0.93 0.90 0.88 0.84 0.80 0.70
3 0.92 0.86 0.85 0.78 0.73 0.65
4 0.91 0.83 0.81 0.73 0.68 0.60
5 0.85 0.79 0.76 0.67 0.63 0.55
6 0.86 0.75 0.72 0.62 0.58 0.50
7 0.76 0.72 0.67 0.58 0.54 0.47
8 0.77 0.70 0.64 0.55 0.51 0.44
9 0.74 0.68 0.62 0.54 0.50 0.43
10 0.72 0.66 0.61 0.52 0.49 0.42
11 0.72 0.65 0.60 0.51 0.48 0.41
12 0.71 0.64 0.59 0.50 0.47 0.40
13 0.69 0.63 0.56 0.49 0.46 0.39
14 0.68 0.62 0.55 0.48 0.45 0.38
15 0.67 0.61 0.54 0.47 0.44 0.37
16 0.66 0.60 0.53 0.46 0.43 0.36

T h e m e th o d d e s c r ib e d in t h i s S e c t i o n a p p lie s th e P I s (a n d r e s u l t i n g p r o d u c tiv it y l o s s e s ) f r o m th e
M C A A ’ s t a b l e , T a b l e 1 a b o v e , t o t h e a c tu a l h o u r s e x p e n d e d b y e a c h w o r k e r in e a c h w e e k o f
a p r o je c t . T h u s , i t is a r e t r o s p e c t iv e a n a ly s is in w h ic h o n e c a n q u a n t i f y n o t o n ly th e to t a l lo s s
o f p r o d u c tiv e ti m e , b u t a ls o t h e l o s t h o u r s f o r a g iv e n p e r s o n , in a s p e c i f i c w e e k , o r o v e r
a g iv e n ti m e f r a m e . 67

6 Id. at p. 9. The M CAA noted: “As d e s c r ib e d h erein , the N E C A tables list th ree im p a ct intensity lev els f o r ea ch
overtim e s c h e d u le : ‘Low, ’ ‘A v e ra g e , ’ a n d ‘H igh . ’ F o r the P I v a lu es show n in the fo llo w in g table, the ‘A v e ra g e ’
v a lu es listed in the N E C A ta b les w e re utilized. W h ere two d ifferen t w ork w eeks re s u lte d in the sa m e n u m b e r o f
total h o u rs (e.g ., a 6 0 -h o u r w ork w eek resu ltin g fr o m a 1 2 -h o u r p e r day fiv e -d a y sch e d u le v ersu s a 1 0 -h o u r p e r
day six-day sch ed u le), the P I v a lu es d e riv e d fr o m the s o u rc e data w ere a v e ra g e d betw een the two w orking
sch ed u les. F u rth e r, fr o m w eeks 1 3 th ro ugh 16, only the N E C A P I v a lu es w ere a vailable. ”
7 Id. at p. 5. The PI is calculated as: (Planned Productivity) / (Actual Productivity), where Productivity is in terms
o f work hours expended per unit o f work installed. Thus, where the actual productivity is the same as the planned
productivity, the PI is 1.0. Where the actual productivity is worse than the plan, and more hours are expended to
accomplish the same work, the PI is less than 1.0.

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A Reasonable Method to Estimate Loss of

Labor Productivity Due to Overtime
A s a p r e lim in a r y m a tte r , t h i s a u th o r h a s n o t, in p r io r a n a ly s e s , in t e r p o la te d b e t w e e n t h e d a ta
p o in t s p r o v id e d b y t h e M C A A . O n e m i g h t r e a s o n a b l y a r g u e th a t in t h e s e c o n d c o n s e c u t i v e w e e k
o f o v e r t im e , i f a w o r k e r e x p e n d e d 6 7 h o u r s , h is o r h e r P I m a y f a l l b e t w e e n t h e P I v a l u e f o r th e
6 3 -h o u r w o rk w e e k ( 0 .8 4 ) an d th e P I v a lu e f o r th e 7 0 to 7 2 -h o u r w o r k w e e k ( 0 .8 0 ) . H o w ev er,
g iv e n th a t ( i ) t h e M C A A d o e s n o t a d d r e s s s u c h in t e r p o la tio n , a n d ( i i ) t h e s tu d ie s u p o n w h ic h th e
M C A A ’ s v a l u e s a r e b a s e d d o n o t p r o v id e d a ta f o r s a y a 6 7 - h o u r w o r k w e e k , a n a n a ly s is th a t
in c lu d e s in t e r p o la tio n b e tw e e n d a ta p o in t s m ay ( r ig h t l y ) com e under s i g n i f i c a n t c r it ic i s m .
T h e r e f o r e , t h e a n a ly s is d e s c r ib e d b e l o w u s e s r a n g e s th a t a r e c o n s i s t e n t w it h th e d a ta p r o v id e d b y
t h e M C A A , e .g . : w o r k w e e k s b e t w e e n 0 a n d 4 9 . 9 h o u r s a r e a s s ig n e d a P I o f 1 .0 ( n o p r o d u c tiv it y
l o s s ) ; w o r k w e e k s b e t w e e n 5 0 . 0 h o u r s a n d 5 3 . 9 h o u r s u s e t h e P I s f r o m th e “ 5 0 h rs/ w k ” c o lu m n ;
w o r k w e e k s b e t w e e n 5 4 . 0 h o u r s a n d 5 9 . 9 h o u r s u s e t h e P I s f r o m t h e “ 5 4 - 5 6 h rs/ w k ” c o lu m n ; e tc .

T a b l e 2 b e l o w is e x c e r p t e d f r o m a la r g e r t a b l e in w h ic h p r o d u c tiv it y l o s s e s w e r e c a l c u la t e d f o r
a ll w o r k e r s o v e r th e e n t ir e d u r a tio n o f a p r o je c t . I t s h o w s o n ly Jo h n S m ith ’ s tim e over
a s i x - w e e k p e r io d , f r o m t h e w e e k e n d in g 2 1 S e p t e m b e r 2 0 1 4 ( W e e k 6 2 o f t h e p r o je c t ) th r o u g h
t h e w e e k e n d in g 2 6 O c t o b e r 2 0 1 4 ( W e e k 6 7 o f t h e p r o je c t ) .

Table 2
Example Table - Inefficient Hours for One Worker in a Six-Week Period

2 1 -S e p -1 4 2 8 -S e p -1 4 5 -O c t - 1 4 1 2 -O c t-1 4 1 9 -O c t-1 4 2 6 -O c t-1 4

P e rs o n n e l N a m e / D e s c r ip tio n 62 63 64 65 66 67 S u b to ta l
S M IT H , JO H N
A c tu a l H o u rs 50 5 4 .5 58 60 42 69 3 3 3 .5
C o n secu tiv e W ee k s W o rk in g 5 0 + h o u rs 1 2 3 4 0 1
C o d e (W o rk w e e k ) 5 0 to 5 4 5 4 to 6 0 5 4 to 6 0 6 0 to 6 3 L T 50 6 3 to 7 0
C o d e (W o rk w e e k - C o n secu tiv e W eek s) 5 0 to 5 4 -1 5 4 to 6 0 -2 5 4 to 6 0 -3 6 0 to 6 3 -4 L T 5 0 -0 6 3 to 7 0 -1
P I C o m p a re d to 4 0 - h r W o rk w e e k 0 .9 5 0 .9 0 0 .8 6 0 .8 1 1 .0 0 0 .8 9
P ro d u c tiv ity L oss 5 .0 0 % 1 0 .0 0 % 1 4 .0 0 % 1 9 .0 0 % 0 .0 0 % 1 1 .0 0 %
I n e ff ic ie n t H o u rs 2 .4 5.0 7.1 9 .6 0 .0 6.8 3 0 .9

T a b l e 2 is a s t r a ig h t- fo r w a r d E x c e l m o d e l th a t in c lu d e s f o r m u l a s ( n o t s h o w n ) w h ic h c a l c u la t e th e
c o n s e c u t i v e o v e r t im e w o r k w e e k s a n d w o r k w e e k r a n g e s , “ l o o k u p ” t h e a p p l ic a b le P I s f r o m th e
M C A A ’ s t a b l e , a n d c a l c u l a t e t h e r e s u l t i n g p r o d u c tiv it y l o s s a n d i n e f f i c i e n t h o u r s . A n a n a ly s t
w it h k n o w le d g e o f E x c e l f u n c t io n s ( s u c h a s ‘ I F ’ a n d ‘ V L O O K U P ’ ) c a n p r o d u c e s u c h a t a b l e
r e la t iv e l y q u ic k ly . T h e p u r p o s e o f t h e f o r m u la s , o f c o u r s e , is t o a v o id m a n u a lly e n t e r in g P I s f o r
h u n d r e d s o f w o r k e r s o v e r d o z e n s o r h u n d r e d s o f w o r k in g w e e k s . O n c e th e f o r m u l a s in R o w s 5
th r o u g h 1 0 a r e s e t u p , a lo n g w it h th e r e f e r e n c e d lo o k u p t a b l e s , t h e r o w s c a n s im p ly b e c o p ie d

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A Reasonable Method to Estimate Loss of

Labor Productivity Due to Overtime
a n d p a s te d t o a lig n w it h e a c h w o r k e r ’ s a c t u a l h o u r s , a n d t o u lt i m a t e ly c a l c u l a t e t h e i n e f f i c i e n t
o

h o u r s f o r a ll o f t h e p r o je c t ’ s w o r k e r s .

T h e d a ta a n d f o r m u l a s c o n t a in e d in R o w s 4 th r o u g h 1 0 a r e d e s c r ib e d b e l o w :

• A c tu a l H o u r s ( R o w 4 ) : T h i s r o w c o n ta in s th e a c tu a l h o u r s e x p e n d e d a s s o u r c e d
f r o m th e c o n t r a c t o r ’ s tim e - r e c o r d in g s y s te m . C o n tr a c to r s ty p ic a lly r e c o r d a c tu a l
h o u rs f o r e a c h w o r k e r o n a w e e k ly b a s is , a n d m o s t tim e -r e c o r d in g / jo b c o s t
s o ftw a r e a llo w s f o r a n e x p o r t o f th e a c tu a l w e e k ly h o u rs b y w o r k e r in t o E x c e l .
T h e h ig h lig h tin g in T a b l e 2 d e n o te s w o r k w e e k s in w h ic h 5 0 h o u r s o r m o r e w e r e
w o r k e d , a n d is p ro v id e d f o r p r e s e n ta tio n p u r p o s e s o n ly .

• C o n s e c u tiv e W e e k W o r k in g 5 0 + H o u r s ( R o w 5 ) : T h i s r o w s h o w s th e n u m b e r o f
c o n s e c u tiv e w e e k s in w h ic h o v e r tim e w a s w o r k e d . I t is a c c o m p lis h e d u s in g
a fo r m u la w ith a n ‘ I F ’ s ta te m e n t: i f o v e r tim e w a s w o r k e d in th e w e e k , a d d “ 1”
t o th e p r io r w e e k ’ s n u m b e r , o th e r w is e r e c o r d “ 0 ” . F o r e x a m p le , in C e ll C 5 ,
m o r e th a n 5 0 h o u r s w e r e w o r k e d in W e e k 6 3 (p e r C e ll C 4 ) , th u s th e fo r m u la
a d d e d “ 1” to th e p r io r w e e k ’ s v a lu e o f “ 1 ” (in C e ll B 5 ) , w h ic h r e s u lte d in “ 2 ” .

• C o d e (W o rk w ee k ) (R o w 6 ) : T h is r o w in c lu d e s a c o d e d e n o tin g th e r a n g e o f
h o u r s w o r k e d in a g iv e n w e e k . A s a d d re s s e d a b o v e , th e r a n g e s a r e c o n s is te n t
w ith th e M C A A ’ s ta b le . T h e fo r m u la in c lu d e s a ‘V L O O K U P ’ f u n c tio n , w h ic h
in tu rn r e f e r e n c e s a lo o k u p ta b le . T h e lo o k u p ta b le in c lu d e s a ll th e h o u r s th a t
c o u ld b e w o r k e d ( in c lu d in g h a l f h o u r o r te n th o f h o u r in c r e m e n ts , d e p e n d in g
u p o n th e a c tu a l la b o r h o u r d a ta ) a n d th e c o r r e s p o n d in g c o d e s . F o r e x a m p le , a n y
a c tu a l h o u r s ( R o w 4 ) b e t w e e n 5 4 . 0 a n d 5 9 . 9 a re c o d in g a s “ 5 4 t o 6 0 . ”

• C o d e ( W o r k w e e k - C o n s e c u tiv e W e e k s ) ( R o w 7 ) : T h i s r o w in c lu d e s a n o th e r
cod e, w h ic h is a c o m b in a tio n o f th e W o rk w eek ( fr o m Row 6) and th e
C o n s e c u tiv e W e e k s o f o v e r tim e w o r k (fr o m R o w 5 ). T o c o m b in e th e s e c e lls ,
o n e c a n u s e th e ‘ C O N C A T E N A T E ’ f u n c tio n o r ‘ & ’ in th e E x c e l fo r m u la .
T h i s c o d e is u s e d to lo o k u p th e r e le v a n t P I v a lu e f r o m th e M C A A ’ s ta b le .

• P I C o m p a red to 4 0 -h r W o rk w e e k (R o w 8 ) : T h i s r o w in c lu d e s th e P I f r o m th e
M C A A ’ s t a b le f o r a g iv e n “ W o r k w e e k - C o n s e c u tiv e W e e k s ” c o d e . The
fo r m u la in c lu d e s a ‘ V L O O K U P ’ f u n c tio n w h ic h c o n ta in s a r e f e r e n c e t o a lo o k u p
ta b le . A p o r tio n o f th e lo o k u p t a b le is s h o w n in T a b l e 3 b e lo w .

8 In projects with many thousands o f workers, the copy-paste exercise may become overly burdensome. A more
sophisticated E xcel model can be created for such projects, but the description o f such modeling is beyond the
scope o f this article.

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Table 3
Excerpt from the Lookup Table

Code PI
50to54-1 0.95
50to54-2 0.93
50to54-3 0.92
50to54-4 0.91
50to54-5 0.85

54to60-1 0.94
54to60-2 0.90
54to60-3 0.86
54to60-4 0.83
54to60-5 0.79

For e x a m p le , in W eek 63, th e fo r m u la in C e ll C8 lo o k s up th e v a lu e

“ 5 4 t o 6 0 - 2 ” ( f r o m C e l l C 7 ) in t h e lo o k u p t a b l e s h o w n a b o v e , a n d r e t r i e v e s th e
c o r r e s p o n d in g P I o f 0 . 9 0 .

• P r o d u c t iv i t y L o ss (R o w 9 ): As e x p la in e d in th e M CAA B u lle tin , th e

p r o d u c tiv it y l o s s is c a l c u la t e d a s 1 . 0 0 l e s s th e P I . 9 In W e e k 6 2 , f o r e x a m p l e ,
t h e P I o f 0 . 9 5 c o r r e s p o n d s t o a 5 % p r o d u c tiv it y l o s s , ( 1 . 0 0 - 0 . 9 5 ) x 1 0 0 .

• I n e f f i c i e n t H o u r s ( R o w 1 0 ) : In a r e tr o s p e c t iv e a p p lic a tio n ( i.e ., w h e n th e h o u rs

h a v e a lr e a d y b e e n in c u r r e d ), th e M C A A p r o v id e d th e f o l lo w in g fo r m u la :

“In efficien t M H s = A c tu a l M H s - [A ctu a l M H s / (1 + In efficien cy F a c t o r ) / ”10

A p p ly in g t h e M C A A ’ s f o r m u l a f o r W e e k 6 2 , f o r e x a m p l e , r e s u lts in :

In e ffic ie n t M H s = 50 - [5 0 / (1 + 0 .0 5 )] = 50 - 4 7 .6 2 = 2 .3 8 h o u rs,
w h ic h is s h o w n r o u n d e d t o 2 . 4 h o u r s in T a b l e 2 a b o v e .

9
See “How to Estimate the Impacts o f Overtime on Labor Productivity,” MCAA Bulletin No. OT1 Revised, 2011, p. 9.
10
Id. at p. 12.

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I n s u m , J o h n S m i t h w o r k e d 3 3 3 . 5 h o u r s in t h e s i x - w e e k p e r io d s h o w n in T a b l e 2 a b o v e , a n d th e
a n a ly s is s h o w s a l o s s o f 3 0 . 9 h o u r s d u e t o t h e e f f e c t s o f o v e r t im e w o r k . N o t a b ly , th e la r g e s t
p r o d u c tiv it y lo s s o f 1 9 % o c c u r r e d in W e e k 6 5 d u r in g M r . S m i t h ’ s f o u r t h c o n s e c u t i v e w e e k o f
o v e r t im e w o r k . W h i l e h e w o r k e d m o r e h o u r s in W e e k 6 7 , t h e p r o d u c tiv it y lo s s w a s l e s s in th is
w e e k ( 1 1 % ) b e c a u s e h e d id n o t w o r k o v e r t im e in W e e k 6 6 , w h ic h “ r e s e t ” th e c o u n t o n th e
c o n s e c u t i v e w e e k s o f o v e r t im e w o r k e d .11

4. ADVANTAGES AND DISADVANTAGES

T h e a d v a n ta g e s a n d d is a d v a n t a g e s o f th e p r o p o s e d m e th o d m u s t b e w e i g h e d a g a in s t o t h e r s tu d ie s
a n d m e th o d s a v a i la b l e t o e s t im a t e p r o d u c tiv it y l o s s d u e t o o v e r t im e . A r e v ie w o f e v e r y s u c h
s tu d y a n d m e th o d is b e y o n d t h e s c o p e o f th i s a r t ic le . H o w e v e r , a f t e r c o n d u c tin g a r e v ie w o f th e
a v a i la b l e a lt e r n a t iv e s , o n e f in d s th a t a ll s tu d ie s a n d m e th o d s h a v e e i t h e r ( i ) b e e n c r i t i c i z e d in
s o m e m a n n e r b y in d u s tr y e x p e r t s o r t h e c o u r ts , o r ( i i ) h a v e n o t b e e n f r e q u e n t ly u s e d o r s tu d ie d ,
a n d t h e r e f o r e h a v e n o t c o m e u n d e r s i g n i f i c a n t s c r u tin y .

T h u s , w h il e th e p r o p o s e d a p p r o a c h h a s p o te n tia l w e a k n e s s e s , s u c h a s a l a c k o f d a ta u n d e r ly in g
t h e s tu d ie s u s e d b y t h e M C A A o r t h e f a c t th a t t h e c a l c u la t e d i n e f f i c i e n t h o u r s a r e e s t im a t e d an d
n o t e x a c t , o th e r a p p r o a c h e s m a y h a v e s i m il a r w e a k n e s s e s .

The e x te n s iv e c a lc u la tio n s and d e t a ils p r o v id e d w it h th i s ap p roach can be a p o te n tia l

d is a d v a n t a g e , a s th e r e is s im p ly m o r e i n f o r m a t io n s u b je c t t o c r it iq u e . M o r e o v e r , th e r e w il l l i k e l y
b e e x a m p l e s w h e r e th e r e s u lt s c a n b e s h o w n t o b e i n c o n s is t e n t w it h t h e M C A A ’ s p r o d u c tiv it ie s .
S u c h a n i n c o n s i s t e n c y is s h o w n in th e d a ta f r o m T a b l e 2 a b o v e . M r. S m ith w o rk e d c o n s e c u tiv e
w e e k s o f 5 0 , 5 4 .5 , 5 8 , and 6 0 h o u rs b e tw e e n W e e k s 6 2 and 6 5 . T h e a n a ly s is s h o w s th a t
M r . S m i t h s u ff e r e d a p r o d u c tiv it y lo s s o f 1 9 % in W e e k 6 5 . T h i s l o s s is b a s e d u p o n h im w o r k in g
fo u r c o n s e c u tiv e w e e k s o f b e tw e e n 6 0 and 6 3 h o u r s , b u t h e w o r k e d l e s s th a n 6 0 h o u r s in
W e e k s 6 2 th r o u g h 6 4 . T h e r e f o r e , in W e e k 6 5 , th e p r o d u c tiv it y lo s s is s o m e w h a t in c o n s is t e n t
w it h th e M C A A ’ s t a b l e a n d is l i k e l y s l ig h t ly o v e r s t a te d . O n t h e o th e r h a n d , t h e o v e r s t a te d h o u r s
in t h i s p a r t ic u la r w e e k a r e m i n o r in t h e c o n t e x t o f th e o v e r a ll a n a ly s is . M o r e o v e r , o n e s h o u ld b e
a b l e t o s h o w e x a m p l e s in w h ic h t h e h o u r s a r e u n d e r s ta te d , a s w o u ld b e t h e c a s e i f t h e h o u r s w e r e
r e v e r s e d ( i .e . , 6 0 , 5 8 , 5 4 . 5 , a n d 5 0 h o u r s ).

On b a la n c e , th e a d v a n ta g e s of th e p ro p o sed ap p roach s h o u ld o u t w e ig h th e p o te n tia l

d is a d v a n ta g e s . O n e a d v a n ta g e is th a t t h e s tu d ie s u s e d b y t h e M C A A a r e r e la t iv e l y w e l l k n o w n
a n d f r e q u e n t ly u s e d in t h e c o n s t r u c t i o n in d u s tr y . A s n o te d p r e v io u s ly , t h e M C A A c it e d f o u r
c a s e s in w h ic h U . S . C o u r ts a n d B o a r d s a c k n o w le d g e d an d / or a llo w e d th e s tu d ie s t o b e u s e d a s a

11 Id. at p. 3. The MCAA wrote: “E x p e r ie n c e ind ica tes that a retu rn to a n o rm a l 4 0 -h o u r sch e d u le ten d s to ‘r e s e t ’
the productiv ity o f a crew , su ch that i f the crew retu rn s to an overtim e sch e d u le after a w eek o r two o f a n o rm a l
sch ed u le, the productiv ity loss w o u ld ‘r e s e t ’ to that o f the fir s t w eek o f ov ertim e.”

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b a s i s f o r q u a n tif y in g p r o d u c tiv it y lo s s e s d u e t o o v e r t i m e .12 F u r t h e r m o r e , in d u s tr y g r o u p s s u c h a s
t h e A s s o c i a t i o n f o r th e A d v a n c e m e n t o f C o s t E n g i n e e r in g ( A A C E ) I n t e r n a t io n a l a c k n o w le d g e
t h e s tu d ie s . F o r e x a m p l e , a ll f o u r s tu d ie s u s e d in t h e M C A A B u l l e t i n a r e li s t e d b y t h e A A C E in
it s R ecom m en d ed P r a c tic e 2 5 R -0 3 , “E s tim a tin g L o st Labor P r o d u c t iv i t y in C o n s tru c tio n
C l a i m s ,” a l b e it w it h o u t c o m m e n t a r y .13

S e c o n d , u s in g a v e r a g e p r o d u c tiv it y lo s s e s f r o m s e v e r a l s tu d ie s , t h e r e s u lts o f w h ic h a r e s i m i l a r ,14

has th e a d v a n ta g e of d e c re a s in g th e p o s s i b il it y th a t th e r e s u lt s a re r e je c t e d due to th e
u n c e r t a in t ie s a s s o c i a t e d w it h a n y o n e s tu d y a lo n e .

T h ir d , t h e p r o d u c tiv it y l o s s e s in th e M C A A B u l l e t i n c a n b e s h o w n t o b e r e a s o n a b l e , o r e v e n
c o n s e r v a t i v e f r o m a c o n t r a c t o r ’ s p e r s p e c t i v e , a s c o m p a r e d t o o th e r m e a s u r e s . F o r e x a m p l e , in its
“ P r o c e s s P l a n t C o n s t r u c t i o n E s t i m a t i n g S ta n d a r d s ,” R ic h a r d s o n p r o v id e d p e r c e n t a g e s t o in c r e a s e
it s s ta n d a r d u n it m a n h o u r s f o r w o r k w e e k s in e x c e s s o f 4 0 h o u r s .15 A c o n t r a c t o r w o u ld u s e t h e s e
p e r c e n t a g e s t o in c r e a s e it s l a b o r h o u r s in it s p r o s p e c t iv e e s t im a t e s t o a c c o u n t f o r o v e r t im e w o r k .
R i c h a r d s o n r e c o m m e n d e d a d d in g : 5 % t o 1 0 % f o r 4 1 t o 4 8 h o u r s p e r w e e k ; 1 1 % t o 1 5 % f o r 4 9 to
5 0 h o u rs p e r w e e k ; 1 6 % to 2 0 % fo r 51 to 5 4 h o u rs p e r w e e k ; 2 1 % to 2 5 % fo r 5 5 to 5 9 h o u rs p e r
w e e k ; e t c . 1617 C o m p a r in g t h e s e p e r c e n t a g e s w it h t h o s e in T a b l e 2 a b o v e , o n e f in d s th a t th e
M C A A ’ s p e r c e n t a g e s a r e o f t e n m u c h lo w e r th a n R i c h a r d s o n ’ s p e r c e n t a g e s , e s p e c i a l l y f o r w e e k s
in w h ic h l e s s th a n 5 0 h o u r s a r e w o r k e d a n d w h e n th e r e a r e le s s th a n f i v e c o n s e c u t i v e w e e k s
o f o v e r t im e .

F o u r th , t h e w e e k - b y - w e e k , w o r k e r - b y - w o r k e r a n a ly s is p r o v id e s e x t e n s i v e d e t a ils o f th e lo s t
p r o d u c tiv it y b y w o r k e r a n d t i m e f r a m e , w h i l e r e q u i r in g l i t t l e o r n o a d d itio n a l t i m e to p r e p a r e a s
c o m p a r e d t o o t h e r m e th o d s .

F i n a l l y , t h e d e t a ile d m e th o d h a s t h e a d d itio n a l b e n e f i t o f a c c o u n t in g f o r h ig h v a r i a b il it y in th e
w e e k l y h o u r s e x p e n d e d b y a w o r k e r , a c r e w , o r t h e w o r k f o r c e in g e n e r a l. I n t h e r e la t iv e l y s im p le
e x a m p l e th a t t h e M C A A p r o v id e d in its B u l l e t i n , i t s h o w e d c e r t a i n m e c h a n ic s w o r k i n g e x a c t l y
4 0 -h o u r w e e k s o r e x a c tly 5 0 -h o u r w o rk w e e k s . L a b o r h o u r s a r e t y p i c a l l y m u c h m o r e v a r i a b le ,

12 Id. at p. 16, footnote 6.

13 See “Estimating Lost Labor Productivity in Construction Claims,” AACE RP 25R -03, 13 April 2004, Appendix
D: Specialized Studies Related to Overtime and Shift Work. On p. 5, the AACE wrote: “ T he e ffe c t o f co n tin u ed
overtim e w ork on la b o r productiv ity is, p e rh a p s , o n e o f the m ost stu d ied productiv ity loss fa c t o rs in the
co nstruction industry. The la rg e n u m b e r o f stu d ies co n ta in ed in A p p e n d ix D is testim ony to this fa ct.'”
14 See “How to Estimate the Impacts o f Overtime on Labor Productivity,” M CAA Bulletin No. OT1 Revised, 2011,
p. 4. The M CAA wrote: “ T he f o u r stu d ies p r e s e n t e d in this ch a p ter a s a b a sis f o r estim ating a c o n tr a c to r’s loss
o f la b o r p roductivity show striking sim ilarities in th eir resu lts .”
15 See Richardson “Process Plant Construction Estimating Standards,” 2003 edition, Aspen Technologies, Inc.,
Volume I, p. 8.
16 Id.
17 See “How to Estimate the Impacts o f Overtime on Labor Productivity,” M CAA Bulletin No. OT1 Revised,
2011, p. 4.

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a s w o r k e r s t a k e s i c k d a y s a n d v a c a t io n s , a n d c o n t r a c t o r s m a y a s s i g n m o r e o v e r t im e w o r k t o its
m o s t p r o d u c tiv e c r e w s o r c r e w s th a t a r e w o r k i n g in c r it ic a l d is c ip l in e s o r a r e a s . I n a g iv e n w e e k ,
a c o n tr a c to r m a y h a v e c r e w s w o rk in g 4 0 h o u rs, 5 0 h o u rs, 5 5 h o u rs, an d 6 0 h o u rs. A n d w it h in
a g iv e n c r e w , i t w o u ld b e u n c o m m o n f o r e a c h p e r s o n t o w o r k e x a c t l y t h e s a m e a m o u n t o f tim e .
T h e p r o p o s e d m e th o d c a l c u l a t e s p r o d u c tiv it y l o s s e s r e g a r d le s s o f th e v a r i a b il it y in h o u r s .

About the Author

Rod C. Carter, CCP, PSP, is a Principal with Long International, Inc. and has
over 20 years o f experience in construction project controls, contract disputes and
resolution, mediation/arbitration support, and litigation support fo r expert
testimony. He has experience in entitlement, schedule, and damages analyses on
over 30 construction disputes ranging in value from US$100,000 to over
US $2 billion. His experience includes heavy civil, nuclear, environmental,
chemical, power, industrial, commercial, and residential construction. He is
proficient in the use o f Primavera Project Planner software, and has extensive
experience in assessing the schedule impact o f RFIs, change orders, and other
events to engineering and construction works. Mr. Carter specializes in loss o f
productivity, cumulative impact, and quantum cctlcidations, and has held a lead
role in assessing damages on more than a dozen major disputes. In addition, Mr. Carter has developed cost
and schedule risk analysis models using Monte Carlo simulations to address the uncertainty o f estimates and
claims. He has testified as an expert in construction scheduling and damages, and has presented expert
findings to an international arbitral tribunal. Mr. Carter earned a B.S. in Civil Engineering from the
University o f Colorado at Boulder in 1996, with an emphasis in Structural Engineering and Construction
Management. Mr. Carter is based in Littleton, Colorado, and can be contacted at rcarter@long-intl.com
and (303) 463-5587.

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