Customers will encounter the situation to give out OT Allowance when employees work overtime.

  • Some companies’ OT Allowance is calculated by different OT hours, for example:

OT Allowance on weekdays=average hourly pay*actual OT hours on weekdays*1.5,

OT Allowance on rest days=average hourly pay*actual OT hours on rest days*2

  • Some companies’ OT Allowance is calculated by employees, everyone has their own OT rate.

The two different situations can both realized by our system. If you want to calculate OT Allowance by our system, you need to do the following steps:

1.Statistics on OT hours

2.Setting OT rate

3.Setting OT Allowance formula

4.Run pay items

Step 1

Workstem calculates the OT hours by Timesheet , employees to submit Timesheet application on App, choose OT on 「 Type」, choose 「Working OT on weekdays」,「Working OT on rest days」or「Working OT on Statutory Holidays 」 on 「OT Category」according to real situations. The supervisor can calculate the corresponding OT hours after approval.

Tips:

If a company calculates the OT Allowance, and the OT rates on weekdays and overnight are different. If employees work overtime from 20:00 to 02:00, and the OT rate from 20:00 to 24:00 is 1.5, 00:00 to 02:00 is 2.

And when employees submit the Timesheet they need to divide into it two documents, and the OT type from 20:00 to 24:00 is 「 OT on weekdays 」,00:00 to 02:00 is 「 OT on rest days 」, then the system will calculate the OT hours accordingly.

Step 2

If the company’s OT rate is fixed, for example OT on weekdays is 1.5, on rest days is 2, then we can skip this step, and set the formula directly.「OT rate」

But if every employee has their own OT rate, then we need to add 「OT rate」in 「Pay Items」(the pay type is others), and import every employee’s 「OT rate」 in basic salary.

Step 3

Find the 「OT Allowance」in the 「Pay Items」of Payroll setting,double-click , the fixed OT rate formula is:

OT Allowance=total overtime hours on weekdays*hourly pay*1.5+total overtime hours on rest days*hourly pay*2+total overtime hours on Statutory Holidays*hourly pay*3

If the OT rate is not fixed,

OT Allowance=(total overtime hours on weekdays+total overtime hours on rest days+total overtime hours on Statutory Holidays)*hourly pay*OT rate

Step 4

After verifying the correct OT hours and finishing the formula, then we can do a pay run, and it can automatically calculate employees’ OT Allowance.

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