Smart Way to Reduce Overtime Costs

HRMLABS
September 03 2018 | 4 min read

Overtime expenses are a serious concern for many businesses. Overtime is generally undesirable because it will increase your company expenses and reduces the employee satisfaction. When it isn’t managed properly, employee overtime can easily become a very costly liability. Finding the way to reduce overtime expenses is the one of your top business priority to keep maintaining a profitable business.

The following tips will explain on ways to reduce the overtime costs and achieving better business results.

  1. Smart Scheduling
  2. Ineffective scheduling has play a big role in contributing overtime costs. Moreover, when staff manager does not aware of how many hours their employees have worked. When there’s no proper record of employee schedule, there can be mistakes of the working time accrued by the employees which cause company to overpay or underpay the employees.

    Fortunately, there is scheduling tool to handle employees scheduling easier and smarter. The real-time status report enables you to monitor how many hours employee has already worked and the remaining shifts at their schedule. When there is swapping shifts, system lets you know which employee is available and make it easier to adjust shift assignment without worrying about the overtime schedule.

  3. Use an Automation System
  4. With automation system, you can identify what activities are contribute to overtime and allow you to take appropriate action. Finding the employees that can work a shift with the least amount of overtime are easier than doing manually with spreadsheet. Moreover, automation give you notification when you schedule an employee into overtime.

  5. Cross-Training Employees
  6. Cross-training can be your solutions to grow your employees’ skill. Sometimes many employees must have the required certifications to be assigned onto their job. If you have limited number of staff that have the required skills, it will be harder to avoid the overtime schedule.

    Cross-training will be best investement in the long run. It will be much easier to distribute shift more evenly when your employees have the skills and certifications that are needed to fulfil different assignments. Furthermore, if an employee does quit unexpectedly, you have plenty of employees with similar skills, so you won’t have to spend money recruiting to replace the role.

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