How to Combat Overtime Hours in the Workplace

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How-to-Combat-Overtime-Hours-in-the-WorkplacePaying out lots of overtime is a frustrating situation for many business owners and managers. You have to make sure that everything gets done, but how do you do so without running into overtime issues?

Spending a lot of payroll money on overtime is a sign that you have too few workers available. But how can you fix that?

Liberty Staffing specializes in helping businesses fill their open positions. A fully staffed business doesn’t have to overspend on overtime! Reach out to Liberty Staffing today to learn more about how we can help. 

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Here are some ways to reduce your dependence on overtime hours in your payroll budget. 

Make Sure You Know What You’re Getting Into with Overtime Pay

The laws in Ontario, Canada are clear: if you ask your employees to work more than their normal hours, you have to compensate them appropriately. 

For example, in Ontario, the law states:

- You must pay 1.5x an employee's regular pay if they go over 44 hours in a week.
- There is no daily basis overtime pay; overtime is calculated on a weekly basis or over a long period under an averaging agreement (we'll talk about this in the next section). 

Don’t get yourself into a situation where you are assigning overtime hours without anticipating how it will affect your bottom line.

Use an Averaging Agreement to Manage Overtime

An averaging agreement is a special addendum to an employment contract in which an employee’s worked hours are calculated by averaging one, two, three, or even four weeks. 

In these cases, the total number of hours is divided by the hours determined by the contract. For example, you may have an employee who works 48 hours a week, then 50 hours, then 38 hours, then 40 hours. That’s a total of 176 hours. If the averaging agreement says you’ll determine overtime by looking at their average hours over 4 weeks, that means that their average is still only 44 hours a week. You would not need to pay this worker overtime. 

This is great if you have workplace flexibility built into your system, or if you are good at scaling up and scaling down based on your production and payroll needs. 

Keep in mind that to be eligible for an averaging agreement, the employer must file for permission from the Ministry of Labour.

Automate Your Processes

This is an important question, even if you’re not currently paying out too much overtime: what can you automate in your workplace

Nobody wants to be responsible for replacing human beings through automation, but when you’re already short staffed, automation can be a lifesaver! 

Some common automation options include email marketing, job advertisements, new employee onboarding, customer service and customer relationship management (CRM), sales, HR, accounting, and data management. 

Depending on the industry you work in, there may be other options available for automation. Don’t forget that automation doesn’t always replace your team members! Even more often, automation is a tool that can make the workday easier for people on your team.

Automation can help people do their work faster and more effectively, thus cutting down on the number of overtime hours you have to assign. 

Hire Temporary Workers

One of the greatest advantages of using temporary workers as part of your staffing strategy is that you can avoid overtime payments. 

There are plenty of great reasons to use temp workers, including the ability to scale up quickly when you need new workers and the opportunity to get to know potential long term hires before you commit. 

But one of the benefits that isn’t discussed as frequently is how temporary workers can help you reduce your overtime expenses. 

Hiring temporary employees is a great way to fill open positions without needing to ask your current staff to work overtime. There is a whole pool of potential candidates who are interested in temporary work but not permanent positions. Tapping into that network means getting new hires onto the job quickly. 

This helps your existing employees because they feel less stressed and overworked. It helps you because you reduce your overall payroll budget–even as you’re bringing on new team members!

Liberty Staffing Can Solve Your Staffing Challenges

Whether you’re having trouble recruiting new talent, retaining your current workforce, or spending too much on overtime pay, Liberty Staffing is ready to help. We’ve been helping employers just like you figure out the complexities of staffing for more than twenty years.

Contact us today to find out more about our strategies and how we can help you solve your staffing challenges right away.

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Linsey Harmer

Working in the diamond mines in the Northwest Territories and the oil sands of Northern Alberta, I wore many administrative hats. From recruiting and onboarding, safety orientations and document control, budgeting and invoicing! After retiring my career at the remote sites, I focused my energy into working directly as a dispatcher and head recruiter for a placement agency in Victoria, BC. Upon my return to Ontario, it was just fitting to continue my work that I love here with Liberty Staffing Services. Work doesn’t end a 5pm! At home on the horse farm, I am constantly working in my garden and in the winter months in my garage building things for the garden for the following spring.

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