Workplace overtime frequently gets mixed reviews. For the average employee, it can be a great way to bolster their earnings. But for employers, it’s often the bane of their existence. Paying out overtime is often unnecessary, costly, and fundamentally detrimental to the operations of the business.
The dangers of overtime are consistently overlooked, and when viewed in the cold light of day it’s startling just how costly they can be. Not only can it negatively affect your bottom line, but it can also bring about serious, harmful side effects for your staff.
From a strategic point of view, overtime has the potential to seriously damage your long-term success and is very much a short-term solution for a larger problem. In fact, some studies have shown that people who work over 60 hours per week experience a 25% decline in the overall productivity (1). Not only is productivity affected, overtime obviously increases costs significantly.
Rather than planning for predictable profit, dysfunctional scheduling can lead to extensive overtime hours for staff, leading to an unnecessarily higher payroll. In this regard, staff putting in extra hours per week acts as a “quick fix” to complete important tasks but only serves to mask a serious problem.
It’s not just detrimental in a monetary sense, however; the more visceral effect can be seen in your staff performance. It’s been said that people are what matter most in a business (2), and if so, overtime can have a grave impact on your biggest strength.
One study found that people who worked three or more hours longer than a normal, seven-hour day had a 60% higher risk of heart-related problems such as death due to heart disease (3). Not only does it affect people physically, it does similar damage to their psychological health, with it being said that 31% of companies with very high overtime levels (more than 10 hours per employee per week) have poor morale (4).
Now that we know how dangerous overtime can be, it’s important to ask the question: What causes overtime? And more importantly, how can it be prevented? Some common causes of overtime are explored below, with corresponding workforce management solutions that have the ability to prevent or solve the problems occurring from each cause.
Resolving Disorganized Scheduling
Overtime is a considerable factor when it comes to employee scheduling. When employee schedules are disorganized, management and staff struggle to accurately match staffing levels to work demand. If you can’t organize staff according to demand, overtime is very likely to occur when demand spikes.
A clever way to avoid this is with the use of simple, easy-to-use scheduling software, such as Schedule Xpress. Having the ability to simply input bulk shift templates, modify shifts with functional tools, and edit individual or group schedules allows your business the freedom and support it needs to maintain an orderly and cost-effective schedule.
Preventing Poor Communication
On the topic of clarity, a principal concern in every business is communication, or lack thereof. Poor communication causes a whole range of unnecessary business-related woes. One of the most frustrating among them, of course, is overtime.
When employees are not clearly notified of their schedule, there tends to be mishaps across the board. Whether it’s showing up at the wrong time, or at the wrong location, overtime as a result of miscommunication isn’t acceptable in today’s business climate. Alternatively, when management is not updated on shift changes or modifications, overtime can occur as a result.
Scheduling software with real-time, accessible chat functionality gives businesses the ability to prevent confusion and miscommunication, thus reducing overtime costs.
Clarifying Employee Availability
When scheduling your staff, it helps to know if they’re unavailable. It’s surprising the amount of overtime that can be caused by vague staff availability and miscommunication.
When manually setting schedules, it can be an error-prone and time consuming process figuring out when your employees are available and whether they can accommodate your scheduling needs. Not to mention, it’s a clear illustration of why overtime can reach profit-diminishing levels. Software with availability functionality and time off requests provides much-needed clarity, decreasing overtime and keeping both timekeepers and staff happy.
Optimizing Supervisor Oversight
Something we haven’t mentioned is the management factor. Different managers have varying strengths and weaknesses, and inadequate or incorrect supervision can result in employee confusion, frustration, decreased job satisfaction, and even turnover. When you consider the overtime factor, it’s easy to see how faulty supervision can directly result in greater staffing costs.
Scheduling software provides management with a visual overview of ongoing and upcoming shifts, including exceptions. It also allows for task management, automated alerts, and shift changes. Basically, it’s a tool that’s as powerful as you need it to be when streamlining and optimizing your supervisory efforts.
How To Organize & Prioritize Qualified Staff
Workforce management systems have many different attributes, as do the different team members in an organisation. Some employee may have certifications or qualifications that allow them to work in certain positions, using specific machinery, or engaging in particular processes.
This situation needs the right employee with the correct skills. In order to deal with this degree of complexity, organisations need a powerful scheduling tool to handle it. At Celayix we love complexity, and our solutions reflect that.
Celayix – The Problem Solvers
At Celayix, we provide powerful workforce management software that scales as your business grows. With 20 years of experience, we know how to solve business problems with adaptable solutions, drastically reducing overtime costs. It’s that simple.
If you’d like to find out a bit more about who we are or what we do, our attentive support staff are always happy to help.
Alternatively, you can take a product tour below, where you’ll see some of the problems we solve for customers, and how the software actually works.