Related Articles: Change Your Pay Period Cycle

Introduction

This article explains how to setup company-wide and individual overtime rules, as well as how to avoid common pitfalls. Two common presets are provided for convenience, but busybusy allows maximum flexibility by allowing you to set custom overtime rules to meet your unique requirements. You can even override company settings on individual employees for those cases where, for example, you have employees working in multiple states, each with their own overtime requirements.

IMPORTANT: 

  • Overtime Rules cannot be set retroactively. In other words, you can only set the effective date into the future. It is essential that Overtime Rules be setup correctly before any overtime-eligible employees start tracking time.
  • busybusy calculates legal overtime rules that are based on a 7 day, 24 hour time period. 

Company Overtime Settings

Begin by clicking 'Company Settings' in the side navigation menu. (Company Settings is available from the desktop only)

Then select the Time Keeping tab:

Standard Overtime Rules


Once on the Time Keeping tab, you will see a section header for Overtime. By default, your new company will be setup with Standard overtime settings, the most common for US based customers. Under Standard settings, hourly employees accrue overtime for all time worked beyond 40 hours in a single week. If your needs are different, go ahead and click the 'Change' button:

This will open up a dialog where you can configure the settings as needed. The first field, Overtime Rules, provides 3 options: Standard, California, and Custom. The second field is where you set the day of the week on which your overtime period begins.

California Overtime Rules

The California option covers most cases for companies operating in the state of California, and breaks down as follows:

The easiest way to explain these settings is with an example.

The first 5 days in this example, the employee accrued 39 hours regular time, 7 hours overtime, and 1 hour of double time. The first hour on the 6th day fulfilled the 40 hour requirement, so every hour after that was overtime.

If your company does business solely in the state of California and/or these setting work your locale, select California.

Custom Overtime Rules

If neither the Standard nor California defaults work for your situation, you may set custom values for any of the multipliers. This should provide enough flexibility to meet the overtime requirements for all US states, and most countries throughout the world.

Most of these settings should need no further explanation. However, it gets a little tricky when the work week doesn't begin on Monday. Before jumping into that, it will be helpful to explain the Work Week setting.

Work Week

The work week applies only to overtime, and is independent of the Pay Period start date. It is a 7-day period, regardless of the length of the Pay Period. Most US companies will probably restart the overtime cycle on a Sunday or Monday, but you have the option to select whichever day of the week you want.

You may experience frustration with having to select an effective date 5 or more days in the future. This, regrettably, is a timezone-related limitation due to the different time zones around the world. 

Circling back to Custom Overtime Rules


With Custom Overtime Rules, you have the flexibility to turn off/on the options on the left hand side of the settings and adjust the hours on the right to have the rules apply after a certain amount of time. Once you have the settings adjusted as you would like, be sure you have the correct day of the week that these custom overtime rules will begin recalculating. (Remember that we calculate overtime based on a 7 day, 24 hour time period) The day you select there is the day that overtime will start over weekly. Select "Save"

Turn Off Overtime Rules

To turn off Overtime rules, simply select "Custom" for your Overtime Rules. The soonest date you can select will automatically be selected in the next field that asks what day of the week you want your workweek to begin. Then uncheck all options on the left hand side for each rule as shown below and click "Save"

Your screen will be shown like this after selecting "Save"

You will see a box showing there is a scheduled overtime change along with all the new details. If you made a mistake, there isn't a way to edit the scheduled overtime change. The way to fix this is to "Delete" it and reenter the information again.

The two link below the box are to view your current overtime rules and to view your overtime history changes.

How to Make an Employee's Overtime Rules Override Your Company's Overtime Rules

  1. Go to Employees from your Main Menu
  2. Select the Employee that you want to make this change for
  3. Select the "Wage" tab
  4. Select "Change" next to the Overtime section on the right.
  5. Then repeat the same steps just as if you were changing the company overtime rules.

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