December 15, 2021
7 min read
Don’t overpay for overtime! How to monitor and effectively manage overtime work.
Overtime work can be managed in a way that benefits both workers and businesses. It allows the company to adequately meet high demands for goods and services and cover ground in cases where there are unexpected absences or attrition, while also providing employees with a larger paycheck. However, without proper management, it can result in huge expenses
for businesses. Aside from the cost of overtime, research has shown that working long shifts can cause fatigue, decreased productivity, and other health issues
. Fortunately, there are measures that can be taken to ensure that working time is effectively managed.
Reasons for overtime
Reasons for working before or after hours include heavy workloads, an overstretched workforce, excessive meetings, or even more sticky situations like (i.e., poor attendance, poor time management, distractions).
1. Heavy workload
Employees frequently work extra hours to keep up with a heavy workload or to make up for a staff shortage.
How to avoid overtime
: Examine the workload and identify which tasks are causing them to work extra hours. Employee monitoring software also helps monitor what software or documents are used and for how long. With this information, the manager can adjust work processes and priorities. Additionally, employee monitoring software
assists in identifying overworked or understaffed departments. This enables managers to delegate work responsibilities to other team members and, if necessary, hire additional staff.
Managers can examine workloads and determine which tasks are causing them to work extra hours.
2. Excessive meetings
According to Forbes
approximately fifty-five million meetings take place daily, and at least half of them do not accomplish much. Excessive meetings consume valuable work time, leaving little time for official tasks. When this happens, people are forced to work overtime to meet targets.
How to avoid overtime
: A practical solution is to assess the necessity of each meeting and invite only those required to attend. Prepare a detailed plan in advance, start on time, and finish on time. Also, if employees are away from their computers for too long, employee monitoring software will flag this time as idle, even if it is spent on meetings. If meetings are held online, WorkTime employee monitoring software
includes a feature that tracks how much time is spent in online meetings.
Employee monitoring software flags the time spent in meetings as idle time. This way, you can see how much time was spent on them.
3. Poor attendance
In the corporate world, poor attendance is quite common. According to one study, 29% of workers
are late to work at least once a month. Poor attendance is demonstrated by arriving late to work, leaving early, taking long lunches, chatting with coworkers during working hours, and taking long coffee/tea/smoking breaks. Employees who spend their working hours doing all of the above rather than doing their jobs will work or claim to work extra hours to compensate for this time.
How to avoid overtime
: Installing time tracking software will assist in automatically detecting computer idle times and login/logout times
.You can use this to determine whether or not your team is working. Furthermore, these solutions work well as standalone solutions as well as additions to existing systems.
Installing time tracking software will help detect computer idle times and login/logout times automatically.
4. Non-use of clock in/out systems
One possible reason employees appear to work overtime could be that they are not properly clocking in or out. Failure to log out for lunch breaks, or after their normal work hours, can give the impression that they were still working at the time. A survey found that employees admitted to clocking out later than their official working hours, failing to clock out for lunch or breaks, or properly filling out their timesheets
. This frequently occurs in businesses that rely on outdated timesheet systems, making it easy to game the system (see this practical example from this WorkTime case study
). This could cost the company a lot of money because they're paying for unworked hours.
How to avoid overtime
: A practical approach will be to replace or enhance existing systems with employee monitoring software
. Once implemented, this solution will record computer activity in real-time. This gives you a clear picture of when shifts begin and end.
Employee monitoring software can be integrated with the existing systems to provide information on login/out times.
5. Distractions during office hours
have a negative effect on work productivity and performance. And as we've mentioned previously, when there are so many distractions during the workday, employees may want to work an extra or two to cover this time.
How to avoid overtime
: Your team can be shown monitoring software reports
to learn about the distractions that are keeping them from working. When your workers see how their time is spent, they can make better-educated choices about their time management.
Monitoring software reports can be shown to employees so they know what distractions are causing them to not work.
When is overtime work necessary?
If you manage a business, your staff may be required to work overtime at some point. If properly managed and with productivity in mind, this could be a win-win situation.
As an employer, you may encounter situations where certain team members need to step in for absent colleagues or when there is an upsurge in demand for your services. This could mean working overtime. Employees, on the other hand, may want to cover additional hours to get additional pay. The key is for both parties to manage it effectively. Overtime policies and employee monitoring solutions, such as overtime monitoring software
, are good additions that help make the process more efficient and cost-effective.
Overtime policies and employee monitoring systems are good additions that help make the process more efficient and cost-effective.
Overtime monitoring software helps!
- Workload balancing
Overtime monitoring software can help you effectively balance the workload. It can help in the decision-making process by determining whether more planning, employees, or computers are needed to improve the process.
- Work processes automation
Your payroll system can be integrated with these systems to eliminate the uncertainty of whether an employee's extra hours have been entered into the system. For example, when active/idle time is recorded, or any changes are made, this will reflect in your payroll system.
- Seamless data collection
Overtime monitoring solutions reduce data collection discrepancies. For example, if someone works 2 hours out of an 8-hour workday and then decides to work longer hours to make up for the remaining hours after work, all of these hours and the activities performed during these hours will be recorded.
- Human error reduction
Because these solutions work automatically, there is less need for manual data entry. Instead of calculating data on paper or in spreadsheets, these solutions automate tasks more susceptible to human error.
- HR analytics improvement
Data-driven decision-making can be supported with the help of monitoring reports. This is a great way to help HR get rid of the time-consuming process of manually comparing reports from various systems. Rather than relying on guesswork, HR can analyze real-time reports of computer activity, active time, idle time, overtime work hours, and so on.
Overtime monitoring software automates the work process, reduces error, and helps with the overall decision-making process.
Setting an overtime policy also helps!
An overtime policy is a formal document that outlines a company's guidelines and procedures for overtime use.
- State instances where workers may be required to work more hours to complete projects, fulfill employment obligations, or compensate for personnel shortages.
- The overtime policy should clearly define who is eligible for working overtime and who the policy applies to.
- Explain the policy's purpose, whether it's to clarify the policies that govern required overtime, establish eligibility and, or explain the disciplinary action for policy violations.
- Clarify what the company considers to be obligatory employee overtime and when it applies.
- Indicate the disciplinary measures that will be taken against excessive or unapproved overtime work and other violations.
- Provide information on the company's compensation policy.
False overtime - don’t overpay!
The first step toward saving money on false overtime is to prevent it from occurring in the first place. As previously mentioned, there are instances where overtime work can be tricky. These include poor attendance, distractions, incorrect clock in/out, and poor time management, to name a few.
Without proper solutions in place to justify these claims, employers end up overcompensating for undeserved hours and retaining the under-performers rather than replacing them, incurring unnecessary costs.
With WorkTime you can save money on false overtime
. WorkTime accurately and efficiently record your employees' work hours/activities. Real-time reports allow you to see how your employees' working hours are actually spent and determine whether overtime claims are false or justified.
WorkTime employee monitoring software accurately and efficiently records your employees' work hours/activities.
Another success story from a WorkTime customer
vividly shows how falsely claimed working hours cost the employer $7,500 more per year. The case in this success story is similar to the previously mentioned reasons. WorkTime served as a great help here!