Time tracking
min read

Why everyone should track overtime

Why everyone should track overtime

Overtime is a heavily loaded concept, often seen as symptomatic of weak company culture and toxic workplaces. Before the Coronavirus pandemic, the average American worker worked a little over four hours overtime every week, and 59% of remote workers were found to work overtime at least once a week. However, since global COVID-19 lockdown began, these figures have likely increased significantly.

Yet overtime isn't always inherently "bad", and many departments requiring 24-hour support depend on regular overtime in the form of on-call rotas. But even when unavoidable, overtime should still be manageable. As with most things, you can't manage what you don't measure, and tracking overtime is in the interests of both employees and employers. Here's why tracking overtime benefits and protects everyone.

Why tracking overtime is important

Protecting employees

There’s a difference between reasonable, seasonal overtime and regular, long-term excessive hours. By tracking overtime, employees have more power to actually do something about it. It lets employees create an objective, indisputable record of their excess hours to hold employers to account; providing evidence to secure correct compensation and address unsustainable work practices. It’s also useful to have for development meetings and performance reviews – whether employees want to seek promotion, request additional resources or improve workflows.

Protecting employers

Tracking overtime is essential for avoiding litigation around employee work hours, which has been a particularly hot global topic in recent years. The Fair Labor Standards Act (FLSA) in the US was updated earlier this year, increasing the threshold of employees entitled to overtime pay. In the EU, as of May 2019, companies are now legally required to track all employee work hours. Tracking overtime also helps reduce payroll surprises and fluctuations at the end of the month.

Seeing what causes overtime

Do employees keep working overtime because they're constantly interrupted? Do certain meetings always overrun? Is work being delegated unfairly within the team? Or is overtime simply the result of poor forecasting? Tracking overtime helps managers surface the recurring problems that actually cause it – from inefficient processes and unmanageable expectations, to poor project planning or communication, and scope creep. Knowing where your operational problems lie ultimately allows you to fix them.

Costing and estimating projects

If you don't capture all the hours spent on a project, you can't accurately gauge a project's profitability and ensure it keeps within your budget – let alone adjust your pricing and estimates for future work. With a record of all project overtime, you can see exactly how much time, money and resources are required for different types of work. You may even discover you’ve been selling yourself short.

Sustaining a happy, effective team

Unmanaged, serial overtime is a huge contributor of work stress, disengagement and exhaustion. Together, these create the perfect conditions for employee burnout and quick staff turnover. Tracking overtime helps managers keep teamwork in perspective, ensuring tasks are distributed fairly, individuals get the right support and everyone keeps a sustainable workflow. It's also crucial for just knowing what capacity you have within your team for any given week (and ensuring you stick to it).

Building a healthy company culture

The way a company treats overtime says a lot about how they see their employees' time and wider corporate responsibilities. Overtime policy and compensation are pretty basic assurances for employees to expect, and a lack of clear policy, management or communication around overtime can damage company culture. Employers who appear ignorant or evasive around overtime shouldn't expect long-term commitment or investment from their staff.

How to track overtime

While tracking overtime is in everybody's interest, it usually falls to managers to find a robust solution to do it. Here companies have two main options: track it manually using timers, spreadsheets or online timesheet software, or automate it using a secure automatic time tracking app. Both approaches have their relative merits and limitations, depending on what you prioritize.

For those looking for accuracy and ease of use above all, automation will be the obvious choice, since it provides a flawless account of all employee hours without manual input. They also make it easy for managers to keep tabs on team and individual capacity, as well as overtime spent on specific work or projects, using ready-made, real-time dashboards.

Those with limited budgets may instead prefer a free spreadsheet or timer-based app. These can be set up to be as simple or elaborate as managers wish, although will consequently require a lot more time and effort from employees to accurately track. These manual overtime trackers also run the risk of introducing expensive human errors into company time reporting.

Try Timely today!
Discover the power of Timely's automated time tracking now!
check mark
Accurately billing
check mark
Project profitability
check mark
Strict anti-surveillance policy
check mark
Trusted by 5000+ businesses globally