Sometimes, my employees work beyond planned hours and then I want to pay them for their extra work. I want this overtime calculation to be fully automated and paid along with employee salaries. This help document describes how you can configure Lenvica HRMS to get this done.
Step 1: Configure Overtime Settings
Ensure that overtime is enabled under ‘Attendance Import Settings’. When this option is enabled, the system will automatically mark work beyond planned time as overtime.
Step 2: Review overtime under the Attendance Screen
Over here, you see that the system has automatically marked the extra time as ‘Overtime’.
As you see, this employee has worked 11 hours of overtime this week.
Let me change to the Month View
As you see, the employee has worked 43 hours of overtime this month.
Now, I’m going to show you how to configure the payroll structures to fully automate overtime pay for all my employees
Step 3: Create a formula for ‘Hourly Rate’
Let us configure the payroll structure of the employee to calculate ‘Hourly Rate’.
Step 4: Create a formula for ‘Overtime Pay’
In my company, we pay 1.5 times of hourly rate for overtime.
Where ‘Overtime Hours’ is the total hours of overtime you see on the attendance screen.
Step 5: Process Payroll
Let’s process payroll for one employee to check how the overtime calculation appears.
As you see, overtime is calculated as 6000. Here is the formula based on which overtime pay is calculated. Now, the calculation history shows the values applied to the formula.
The overtime hours you see here are taken from the attendance summary for the month.
Step 6: Process payroll for all employees
As the formula we just configured appears correct for one employee, let’s process payroll for all employees.
Step 7: Review Salary Register for Overtime pay
That’s all. We have successfully configured overtime pay for all employees. The system will automatically calculate overtime pay for all pay periods from now onwards.
Frequently Asked Questions
What is overtime pay?
Overtime pay is additional compensation given to employees for working beyond their regular hours or exceeding maximum limits set by labor laws.
How is overtime pay calculated?
Overtime pay is typically calculated by multiplying the regular hourly wage by a predetermined overtime rate, often 1.5 times the regular rate.
Are all employees eligible for overtime pay?
Eligibility depends on labor laws and job classification. Most hourly employees qualify, while some salaried or exempt employees may be exempt from overtime pay.
Are there limits on the number of overtime hours?
Yes, there are usually limits on weekly or daily overtime hours set by labor laws or industry regulations.
Can overtime pay be given as time off instead of extra wages?
In some cases and jurisdictions, employers may offer compensatory time off (comp off) in place of overtime pay, but rules may vary.
What should I do if I haven’t received proper overtime pay?
Review labor laws applicable to your situation, discuss the issue with your employer, consult a labor law attorney, or contact the relevant labor department or employment agency for guidance.
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