You need to meet a deadline, your boss requires you to finish a task tonight, or you have to pull a double shift to help out a sick teammate: sometimes you just have to work the extra mile. That’s fine, as long as you get compensated. But what to do when the days seem too long and the weeks too short on a regular basis? Do you know how to manage your employees’ overtime? And what about overtime for freelancers?
Overtime Rules and Regulations
The definition of overtime depends on the type of work, country-specific laws, and the individual contract. Most countries have pretty clear rules and regulations about those hours of extra work. The United States Department of Labor, for example, defines overtime as more than 40 hours a week and clearly states that an employee’s extra work needs to be compensated with “at least one and one-half times their regular rates of pay“. Canadian employees need to work 44 hours a week or more to get their overtime pay, while UK employers don’t have to pay workers for overtime. Some health professionals, like doctors and nurses, are exempt from the definitions stated above. Whether you’re a business owner or an employee, it is important to know your rights and your duties.
Overtime Pay or Time Off?
Sometimes, a job just needs to get done… (Photo by shutterdemon | stock.adobe.com)
In some situations extra hours can be compensated with time off. This makes sense if you’re working a lot to meet a deadline one week and can then take it easier the next. Though it might not come in handy if you’re keen on the extra money of overtime pay. Ideally, employees should have the choice between overtime pay and getting paid with time. Whatever you choose, one thing is clear: you need to keep track of the time you spend working.
How To Calculate Overtime
To calculate overtime, you need to know how much time you work: you need to track your time. This is why fair-minded employers use time tracking tools for their teams. If your employer doesn’t utilize such tools, and you’re worried about overtime, you should start tracking your time right away. Your next step is to define what extra hours mean in your situation: is it a 45 hour work week, or a 10 hour work day? Once you compare the time you should work with your actual hours worked, you’ll get a clear picture of the extra hours you’ve put in. If that sounds like too much effort, don’t worry; there are smart time tracking tools that can help you calculate your overtime in the blink of an eye, and some even automatically add it to the play slip or invoice.
Who Pays For The Extra Work?
Any employer who requires employees to work more has to pay for the extra hours, right? But wait! It’s not that simple. Sometimes employers pass the burden on to their clients by adding the extra hours to the project bill and claiming that extra money back.
Do you know who really pay for extra hours? (Photo by pressmaster | stock.adobe.com)
But who really pays for overtime? It’s always the worker who has put in the hours; he or she, whose body and mind has gone the extra mile, spent more time and energy than they are legally required to, and sometimes more than they should.
When To Take Action
Sometimes, you just can’t do your job in a 9-to-5 day. That’s ok - as long as it is an exception to the rule, which sadly, it usually isn’t. There are many jobs where overtime has become the rule; more often than not without fair compensation. This is not just unfair but a major issue with widespread consequences for employers and employees alike. Constant stress is a proven health hazard, severely reducing quality of life and maximizing costs for employers as well as the healthcare system. Business owners who want to run a sustainable business need their employees to stay healthy. They need to organize their teams so they can keep to their regular hours.
Business Owners, Freelancers and Overtime
Freelancers and business owners almost always work overtime. (Photo by bernardbodo | stock.adobe.com)
What about self-employed workers, like business owners or freelancers? They frequently work more than they should, but usually the overtime is not regulated. Therefore, freelancers should use their Terms & Conditions to define clear overtime terms (for example, being required to work on Sundays) or add specific provisions to the contract they’re working under. Self-employed business owners or start-ups need to find their own ways to get compensated. And often being proud of their hard-earned achievements can be very powerful compensation, indeed.
Whatever the position you’re in: smart time tracking is a great tool to manage overtime, and to stay healthy in life and in business. Start right now!
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