When calculating daily or weekly overtime, it is important to control whether paid time off (such as PTO, Vacation paid, sick paid and so on) is included towards the overtime floor.
- Time and attendance module is activated
- "Calculate overtime" is switched on.
To define whether paid time off is counted toward overtime floor;
- Locate a parameter called "Count all paid hours for overtime floor"
- Set the switch to on ("Yes") if paid time off is counted to overtime floor. This is the default settings.
- If you do not wish to count paid time off for overtime floor, set the switch to off ("No").
4. Click the "Save" button to save changes.
Let's review settings the parameter whether to count or not count paid hours to overtime floor works:
For a given site, the daily standard hours is set to 8 hours. Employees who work more than 8 hours are entitled to overtime.
On a given day, the employee worked from 09:00 - 14:00 and took a half a day off (holiday). With the "Count all paid hours for overtime floor" switched to "Yes", the employee will get 1 hour in overtime
- Worked for 5 hours
- Took a paid leave (which worths half a day) - 4 hours.
This is because the total amount paid includes paid leave and the employee reaches 9 hours of paid attendance (8 hours regular + 1 overtime).
When the "Count all paid hours for overtime floor" is switched off, the employee will not earn any overtime.
He will still see a total of 9 hours paid, but all hours will be paid as regular hours because the half day holiday is not counted to overtime.
For a given site, overtime is paid on a weekly basi:
- Once a 40 hours threshold is met.
- The daily standard hours is 8 hours
- The weekly overtime counting starts on Monday (until Sunday)
- Both paid time off hours and calendar holidays are considered paid time.
On a given week, an employee worked as follows:
- Monday: 08:00 - 12:00 (the rest took as half a day paid holiday) - tot. paid hrs. = 8
- Tuesday: 08:00 - 17:0 - total paid hrs = 9
- Wednesday: Employee was on a paid leave (Jury duty) - total paid hrs = 8
- Thursday: employee was on a paid public holiday - total paid hrs = 8
- Friday: 08:00 - 16:00 - total hours paid = 8
So total paid hours this week is 41 hours, and because the "Count all paid hours for overtime floor" is set to "Yes", paid leave "Jury duty" is also counted and so the employee will actually be paid 40 hours in regular + 1 hour in overtime.
If the "Count all paid hours for overtime floor" is set to "Yes" then the employee would not reach the overtime floor of 40 hours and no overtime will be paid as Jury duty and the paid public holidays will not count to weekly overtime,
Total hours worked = 4 hours (Monday) + 9 hours (Tuesday) + 8 hours (Friday) = 21 hours only!
For more information on what is considered paid time, please refer to this article.
Need more help? If you're unsure about anything, send us a message through the chat icon below.