Canadians who work in hourly positions must be paid overtime if they work more than 44 hours in a week. At 1.5x the normal hourly rate, this expense can add up quickly for employers.
Many employers are trying to figure out how to reduce the total their employees receive in overtime pay.
Liberty Staffing helps employers in Southern Ontario figure out how to manage their staffing challenges. When employers feel overwhelmed by issues like understaffing, paying out too much overtime, or high employee turnover, that’s where we thrive! Contact us today to find out how we can help.
Here are 5 ways you can cut back on overtime hours.
1. Don’t Treat Overtime Hours as “Normal”
Sometimes, especially in times of understaffing, overtime can feel like the normal, typical thing that happens all the time. Unfortunately, this is a costly way to manage your staffing schedules. In addition to being expensive, it’s also an easy way to overwhelm your current employees.
Even though some people like to get those overtime hours to see an increase in their pay, too much overtime can increase employee stress and lead to burnout.
Try to view overtime as something you can use when you need it, but not as something that consistently solves your production and staffing issues.
2. Track Your Use of Overtime
You may need to complete an in-depth analysis of your current use of overtime to know where your existing problems lie. You need to determine:
When are you dependent upon overtime? Does it tend to be during a certain time of week, month, or year? Are you more dependent on overtime for certain holidays or seasons?
Who is consistently earning the most overtime? This isn’t about identifying individuals who step up to help when there is an overtime need. Rather it’s about discovering patterns in what kinds of positions are consistently in need of overtime work.
How does your planned labour budget compare to your real labour costs? Are you successfully predicting your need for overtime hours, or are you expending more than you planned?
A thorough analysis of these patterns and trends will help you to identify what you need to do to reduce your overtime payouts.
3. Embrace Flexible Work Schedules
Workplace flexibility is popular with employees and it can reduce your need for overtime hours. Flexibility can look like hybrid in-person and remote work, employees choosing their own schedules, and condensed work weeks, among other things.
Over and over, studies have found that flexibility increases productivity. That kind of productivity increase could have a direct impact on your need for overtime because you will see more work completed in fewer hours.
4. Utilize Temporary Workers to Reduce Dependence on Overtime
Temporary employees provide businesses with the kind of flexibility they need to keep their operations fully staffed during busy times – without having too many employees after things slow down again.
Most industries have natural ups and downs in their labor needs throughout the year. For example, manufacturers often need to increase production in time to ship products for the holidays, but then have a predicted slow-down after the holidays.
It makes sense to be hesitant to hire a bunch of permanent employees for that busy season because you know what’s coming next.
This is where temporary workers can come to the rescue. Temporary employees can help you meet your needed labour hours without paying overtime to your permanent staff.
5. Work with a Staffing Agency to Manage Your Hours
A staffing agency can help you find permanent and temporary workers, but that’s not all we do. We can help with hiring, recruiting, onboarding, training, and staffing management.
Staffing agencies can help you with many of the processes we’ve listed here: tracking hours, analyzing your use of overtime, scaling up and scaling back down to adjust to labour demand, and more.
Liberty Staffing – Helping Southern Ontario’s Businesses Save on Overtime Costs
We have been helping employers in Southern Ontario manage their staffing needs for more than twenty years. That includes helping you reduce your dependence on overtime costs!
Reach out to us today to learn more about how we can help!
