State Employee Overtime Costs Hit Record High

Connecticut state agencies spent a record $305.4 million on employee overtime in fiscal 2023, a 15% jump over the previous high set in 2022.

The legislature’s nonpartisan Office of Fiscal Analysis’ annual overtime report shows average per-employee overtime increased 11.5% to $16,288 for the 12 months ending June 30.

Overtime spending has significant implications for Connecticut taxpayers as it is among the factors used for calculating state employee pensions.

Failure to control costs places additional pressure on the state’s long-term liabilities burden, one of the highest per capita in the country.

Overtime costs hit a 10-year low in 2017, following passage of legislation requiring quarterly disclosures of agency spending.

However, spending has increased every year since, hitting $228.2 million in 2018, $234.3 million in 2019, $234.9 in 2020, $239.9 million the following year, and $265.9 million in 2022.

Taxpayer Burden

Connecticut spends a higher share of its payroll on overtime than neighboring states—over 11%—compared with 5% in Massachusetts, 4.7% in New York, and New Jersey’s 4.2%.

CBIA’s Chris DiPentima said while the labor shortage is impacting state agencies and contributing to rising overtime, policymakers must address outdated workplace practices.

“The CREATES report, produced for the Lamont administration over two years ago, identified between $70 million to $100 million in annual cost savings,” he said.

“Those commonsense recommendations included capping pensionable overtime, modernizing workforce management, improving hiring processes, and strengthening overtime oversight and workers’ compensation practices.

“Taxpayers cannot afford to keep shouldering tens of millions of dollars in new state overtime spending every year, particularly when there are real solutions on the table.”

Overtime Spending: Top Five Agencies

Department	FY 2023 Overtime	FY 2022 Overtime	$ Difference	% Difference
Correction	$106.5 million	$94.3 million	$12.2 million	12.9%
Mental Health & Addiction Services	$63.8 million	$53.6 million	$10.2 million	19%
Developmental Services	$42.2 million	$42.8 million	($614,698)	-1.4%
Emergency Services & Public Protection	$41.7 million	$37.9 million	$3.8 million	10%
Children & Families	$21.4 million	$17.5 million	$3.8 million	21.6%

Source: State Office of Fiscal Analysis.

DOC Costs Soar Again

Five agencies accounted for more than 90% of all overtime spending in fiscal 2023, again led by the Department of Correction.

DOC’s annual overtime spending jumped 12.9% in 2023 to $106.5 million—35% of all state agency overtime.

DOC overtime spending soared 48% in the last five years while Connecticut’s prison population declined by 25%.

That’s despite the state’s prison population declining by almost half since hitting an all-time high in 2008 and by 25% since 2018.

DOC overtime spending soared 48% in just the last five years, even as the state closed three prisons.

In announcing the closure of the Willard Correctional Institute earlier this year, Gov. Ned Lamont said “spending millions annually to operate facilities for a population that is significantly smaller than just a few years ago is not a good use of taxpayer money.”

Agency Spending

Overtime spending increased 19% to $63.6 million in fiscal 2023 at the Department of Mental Health and Addiction Services while falling 1.4% to $42.8 million at the Department of Developmental Services.

The Department of Emergency Services and Public Protection—where the CREATES report recommended increasing staffing levels—saw a 10% increase, while the Department of Children and Families posted a 21.6% jump.

Outside of the top five agencies, the Department of Social Services posted the biggest spending increase, with costs ballooning 172.8% to $8.2 million.

State agencies paid 18,751 employees overtime in 2023, with the average payment increasing 11.5% to $16,288.

Fourteen of the 38 agencies included in the report reported declines, led by the Department of Education, where costs dropped $1.6 million or 98.7%.

State agencies paid 18,751 employees overtime in 2023—up by 410 from 2022—with the average payment increasing by $1,786.

DESPP employees were paid an average of $34,621—the highest of any agency, followed by DMHAS ($27,999), DDS ($21,332), and DOC ($20,577).