5 Causes of Costly Unplanned Overtime

Posted on

January 4th, 2021


Working overtime happens in all industries, particularly during peak seasons. However, paying employees overtime is an expense that executives don’t accurately calculate into the budget. It can cause several headaches across multiple areas within the company as well. HR has to make sure the company complies with labor laws as well as field disgruntled employees. Managers have to distribute the additional hours across their teams, which makes scheduling a challenge. Employees that work overtime may harbor resentment toward their employers or burn out from the extra work.

The costs of unplanned overtime have a domino effect throughout the entire organization. If businesses are paying more for overtime than they planned for, they may have one of the following problems:

  1. A company culture that encourages working overtime. If employees receive bonuses for working overtime, it can incentivize staying late. Similarly, if management or company leadership conflates loyalty with working overtime, employees may feel their job is in danger if they don’t work more than 40 hours a week.
  2. Chronic staffing issues. Every company has surges that may require employees to work late. However, if these periods of knuckling down become a weekly event, the company may have a staffing shortage. Employees that seem burned out or complain of needing a vacation may have too much work for one individual.
  3. Insufficient training. Employers may notice certain employees take an excessive amount of time to perform their work. This issue could also present as new employees consistently taking longer than their coworkers to perform the same task. Providing employees with additional training or professional development opportunities can help cut down on this kind of unplanned overtime.
  4. Outdated technology. Slow technology or insufficient equipment can hamstring productivity. If employees don’t have the tools they need to complete their work within normal hours, the overtime will begin to accumulate.
  5. An unclear or poorly enforced overtime policy. If managers aren’t clear on policies, they may consistently schedule overtime without realizing the costs. Employees may also work additional hours without approval if the company handbook doesn’t outline the rules for working overtime.

Having advanced attendance tracking technology can provide actionable insights to help businesses combat unplanned overtime. Actec’s absence tracking mobile app provides data so companies can identify trends. This allows them to pinpoint which departments or employees have consistent attendance issues. Whether your company is struggling with employee tardiness, absenteeism, or unplanned overtime, Actec can help. Contact us to learn more about our absence tracking mobile app.