Wonderful questions. Sorry it took all day to get you an answer. Hope it was worth the wait. From our payroll guru, Alan McEwan:
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Glenn, a few points for the client to consider:
- With some exceptions, employers are required to keep proper records of the actual hours worked and provide this information to employees via the pay statement. The records themselves must be kept on a daily basis, but may be summarized by pay period on the pay statement. Overtime hours worked must be recorded separately and shown separately on the pay statement.
- It would be helpful to know what industry is involved, as there may be exceptions that apply. The requirement to track actual hours worked does not apply to IT professionals, for example.
- Employees are also entitled, on request, to a written explanation of how any bonuses have been calculated.
- Paid time off in lieu of overtime worked must be given as 1.5 hours off for each overtime hour worked.
- Employees must be paid for the time worked, even if their work is below standards for quality.
I have always believed its better to manage by results, rather than requiring employees to seek approval for overtime in advance.
My own suggestions would be:
- To put in place a time and attendance system that allows employees to record all their billable and non-billable time, in the simplest manner possible. This can be done without becoming an administrative burden.
- Rather than requiring employees to seek approval in advance for overtime, it would be better to treat this is a performance issue. If employees work overtime, when this is not required for billable time or they are not working efficiently, then this should be discussed as a performance issue. In other words, its better to manage this by exception, instead of imposing approval requirements.
- It would be better to separate bonus calculations from OT hours worked. Instead, employees given be given bonuses based on their results, rather than on a measure of their work efforts.