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5 Overtime Policy Templates

Having a company policy related to overtime is essential in ensuring that everything within a company runs smoothly. A lot of workers try to do overtime work even if the employers did not state that they could do so, and some of these employees aren’t even qualified to do overtime work.

Having a well established overtime policy ensures that those who are qualified to do overtime are able to ask for approval, making it much easier to manage who deserves more pay for their extra efforts. So if you want to avoid misunderstandings regarding overtime, then here are the steps that will help you create an efficient overtime policy:

Differentiate Between Exempt Employees and Non-Exempt Employees

All you have to remember is that non-exempt employees can be paid overtime, while the exempt employees cannot. Here are a couple of examples of employees that do not receive overtime pay:

  • Executives
  • Doctors or Lawyers
  • Administrative Workers
  • Outside Salespersons

Establish How and When Overtime is Acceptable

You have to be clear on this to make sure that employees don’t work overtime whenever they please (assuming that you told them that they could  not.) You can state in your company policy that employees can only work overtime should their managers allow them to. You also have to guarantee that there are rules and regulations regarding when an employee may do overtime and how long they can do so. This prevents them from abusing the overtime system of your company as  some of them will do what they want while hoping to get paid extra.

Know the State Laws Regarding Overtime in Your Country

As the employer, it’s your job to understand the laws regarding overtime. Make sure that you do this to prevent you and your company from facing any lawsuits. So you should look into the current policy regarding how much overtime you can allow, how much employees should be paid for working overtime, and how you are going to calculate everything based on the employee’s contract and duties. These laws can vary from country to country and from state to state, so be sure to go through the ones in yours.

Create a Written Policy Regarding Everything That’s Related to Overtime

Make sure that you place everything into one document, but you also have to be sure that it’s simple and easy to understand. Try not to include more than 2 exceptions to the rules, and you have to guarantee that every single one of your employees receive a copy and have read these copies.

You will come across those employees who want to work overtime simply because they want more money or they want to look really good to get that shot for a promotion. But you can’t just let employees do this unless your company is financially stable enough to pay overtime, or if the employee isn’t exactly qualified to work extra hours. So follow the steps above to ensure that your overtime policy is one that all employees will be able to understand and follow. Otherwise, you might be paying employees extra when they don’t even deserve it.

If you would like to learn more regarding overtime policies or anything related to the matter (such as how to write a company policy), then all you have to do is go through our other articles to give you what you need.



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