White Paper

Overtime in Logistics: A New Story of Retention, Risk, and ROI

Understand the impact of overtime tax changes on retention, compliance, and ROI for warehouse and driver operations.

UKG Insights

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25-35%

average increase in worker take home pay from the new overtime tax deduction

28%

higher accident and error rates tied to 12-hour warehouse shifts vs. 8-hour shifts

18%

boost in job applications when “tax advantaged overtime” appeared in recruiting ads

In logistics, overtime is now a retention, compliance, and ROI strategy

Overtime in logistics is being redefined. With a new federal tax deduction, many hourly workers now take home 25–35% more pay from overtime hours. That’s turned extra shifts into a powerful tool for retention and recruiting — in fact, job ads mentioning “tax-advantaged overtime” are already attracting more applicants.

But the upside comes with risks. Longer shifts mean more fatigue and compliance exposure, with accident and error rates climbing 28% higher on 12-hour schedules. For leaders, each overtime hour is both an opportunity and a liability: those who fail to adapt risk higher costs, compliance penalties, and workforce fatigue.

This white paper explores how distribution centers and field-service fleets can make overtime work in their favor. Run overtime well, and it becomes more than a cost — it becomes a competitive edge.