How to manage overtime?

Overtime, the amount of work done beyond the planned schedule, is too complex an issue to simply offer an “avoid at all cost” kind of advice.

In fact, putting in the extra hours might be the only way to save a project when unexpected complications happens. What you don’t want is for overtime to become a regular occurrence, as it can damage your company both financially and culturally.

Fortunately, there are some proven practices that can help you manage overtime sensibly. In this article, we’ll go through them one by one.

Plan a balanced workload to avoid overtime

It all starts with planning a balanced working schedule. This is where you can make costly mistakes that will multiply throughout the project. How to avoid them? When possible, try to plan flexibly, allowing for alternative scenarios and time adjustments.

You might also want to analyze the planned workload for all your employees: pay extra attention to people with unique skills, whose tasks can’t be transferred to other team members. If their workload is high, overtime is more likely to happen, as there’s nobody else to help out. One idea to avoid it would be to build a network of freelancers that could be plugged in to the project when needed. Another one is to hire a new person with similar skills who can take on some of the workload.

Increase productivity from 9 to 5

Monitoring the workload, while an essential step, is not always enough to avoid overtime. Project with tight schedules and unmovable deadlines have very little wiggle room when something goes wrong. A sick employee or a technical issue can quickly result in the team having to put in extra hours. To minimize the overtime, you can implement a couple of rules to help people focus on their 9-5 work.

First off, you want to make sure that your team knows what their upcoming assignments are. Obvious as it sounds, it’s not always the case. Team members who don’t know their tasks (or don’t fully understand their scope) are likely to lose a lot of precious time before kicking off work.

The next step would be to cut any meetings that aren’t absolutely essential. If you’re following an agile approach to project management, you can schedule scrum meetings. They are designed to cover the essential points without wasting time and resources.

Another way to increase efficiency is to facilitate communication between team members. There are a lot of collaboration tools on the market: ranging from chat apps (e.g. Slack) to project management software (e.g. JIRA). Once your tools are chosen, try to integrate them with each other to create smooth workflows. One example would be to install JIRA notifications on Slack: this way team members can see the updates in real time and react accordingly.

Manage overtime throughout the project

Once the project is launched, you need to track the progress of deliverables as well as the actual workload. How to do it? An efficient way to be aware of your employees’ working time is to use time tracking software. It’s actually convenient for the team as well. Thanks to timesheets, your team members can be sure you see their extra effort. An upside for the managers? The sooner you know about the overtime, the quicker you can get to the root cause.

In order to monitor your team’s timesheets efficiently, it’s best to use an auto-updating timesheet report. Looking at the tracked time data t’s useful to analyze timesheet descriptions as well. Descriptions are comments your employees can enter when logging a given time entry. Checking descriptions can give you valuable insights into your team’s overtime patterns:

In the picture above you can see that Rose only logged in significant overtime when she had tasks that required her to interact with the client (workshops, asset reviews). Perhaps that’s something worth looking into? 

Depending on the cause of the overtime, you can either adjust the project schedule (read more about project scheduling techniques) or plug in extra help. If you believe some overtime is impossible to avoid, make sure to communicate your expectations to the team.

Calculate compensation for the extra work

While many employees are willing to go the extra mile, their overtime leads to a negative work-life balance. For that reason, most companies pay extra for the time beyond the regular hours. Since all expenses should be included in the project budget, it’s important to know how much money will go into overtime compensation.

Some resource management tools make this task easier by providing reports you can pull from the timesheets. In Teamdeck, you can create an auto-updating compensation report that will help you manage overtime. Simply choose the data points you need and enter your team’s overtime rates. You can use different rates for different team members. As the project goes on, all you have to do is open your report and check the current overtime spendings. You can even share the report link with your payroll team to make their jobs easier as well.

Overtime compensation report in Teamdeck

Once you have an adequate overtime management policy in place, don’t forget to communicate the expectations to your team. Workplace transparency is especially important here, as it can help you avoid employee burnout. A recent study by Gallup showed that while unmanageable workload indeed is one of 5 factors correlated with burnout, so are lack of communication and support from manager and unreasonable time pressure. Open communication, understading of project’s time constraints and clear rules for overtime compensation are necessary for your team members to feel better about their current workload.

Teamdeck makes it easier to manage overtime of your team. With timesheets and overtime compensation reports, you can stay on top of your team’s workload and project budget at the same time. Schedule a demo with Joanna and learn how to run your team effectively!