Since the pandemic, remote and hybrid jobs have become increasingly common. Employees like the ability to eliminate their commute and work from the comfort of their homes. However, the lack of face-to-face time in offices has led to some shifts in how businesses operate, including the ability to track employee hours and overtime eligibility.
Businesses need to record the number of hours their employees work so they know when they become eligible for overtime payment. Tracking hours also has valuable implications for the rest of your business operations, including gauging productivity.
Let’s look closely at the importance of accurate remote work overtime calculations for your business.
Understanding Overtime Regulations
Businesses have to pay overtime to certain employees if they work more than 40 hours per week. Hourly employees, as well as those who earn below a particular threshold, get time-and-a-half for each overtime hour.
The specifics of these regulations can shift slightly from state to state, meaning businesses should also investigate their local laws to ensure they fully understand who is eligible for overtime and under what conditions.
Impact of Remote Work on Overtime Calculations
When employees work remotely, it can become more challenging to determine how many hours a given employee works throughout the week. You do not see them come into the office or leave. People may also work more flexible hours on their own time, such as taking a longer lunch but then answering some emails at night after typical work hours. This further complicates timekeeping, which places stress on businesses as they try to determine how much to pay their workers.
Remote work also opens the door for businesses to hire employees who might not live anywhere near their company– they could work in another state or time zone entirely. In these situations, companies also need to account for the time changes when calculating employee work hours.
Overall, companies find it significantly more challenging to monitor employee work hours when they do not see them in person.
Common Mistakes in Remote Work Overtime Calculations
As businesses work to navigate the challenges associated with remote work time tracking and overtime, there are some common mistakes that appear. Here are a few that companies want to pay close attention to so they can take particular precautions.
- Overlooking unauthorized overtime. With the challenges in tracking employee hours, businesses want to establish a policy to ensure all overtime receives approval.
- Misclassifying remote workers. Companies also need to think about the differences between independent contractors and employees. Knowing the differences between the two, including the level of control employers have over employees versus independent contractors, helps you place workers in the right category. This classification also impacts overtime regulations.
- Ignoring state-specific laws. While the federal government has remote work labor laws and overtime regulations, many states have their own additional regulations as well. Companies must ensure they understand all the applicable state laws that relate to them and their employees.
Tips for Accurate Time Tracking and Management
To help companies improve their overall timekeeping strategies, you have a few different techniques you can implement. See how each of these might fit with your business operations.
- Implement reliable time-tracking software. You can use software to track when employees log into work and when they log out. This will help you with remote work payroll compliance and managing remote employee hours.
- Clear communication regarding your overtime policies. Make sure your employees know your policies for taking overtime, including the circumstances in which it is allowed and if they need to get approval.
- Regularly audit your time records. Do not wait for shocking timesheets to accumulate. Have a policy of regularly looking over your timesheets so you know how many hours your employees take during a given week. If anything seems out of the ordinary, ask your employee about it.
- Provide proper training. Give your managers and employees the necessary training on your time tracking and overtime policies. This empowers them to communicate these policies clearly to their teams and ensure everyone abides by the policies.
Ensuring compliance
As you improve your internal systems to better track your employees’ hours and overtime, you also want to establish certain procedures to establish legal compliance. Working closely with your legal and HR experts will get you started on the right path. These professionals can help you update your company policies to reflect the current remote work overtime rules and how you want to handle overtime within your organization.
Instruct your internal departments to have a policy of keeping thorough records of all employee hours and overtime calculations. These records will provide you with the solid evidence you need for paying or not paying employees overtime hours.
Remain Compliant with Overtime Regulations with ASAP Payroll
Time-and-a-half payment for overtime ensures that employees receive adequate compensation for working beyond the standard 40 hours. Maintaining accurate time tracking and remote work overtime calculations provides your employees with fair compensation and keeps you compliant with local and federal laws.
Those who need to manage remote work payroll complexities should work with a professional like ASAP Payroll to better understand what needs to be done. Come and see what ASAP Payroll can do for you.
