TABLE OF CONTENTS
- OT Exclude
- Minimum Wage Type
- Overtime/Double Daily hours calculation - Regular mode
- Overnight Shift Hours
- Update Overtime
- Weekly Overtimes
- Shifts that occur at the intersection of Weeks/Payroll Periods
Payroll State's overtime rules are set up in the States reference. Find more in the article about State Overtime Laws.
Employee-specific OT rules are configured in the Employee's TK Configuration.
To learn more about the Time Card payroll allocation table, visit the article about Time Card.
We have two modes of overtime hours calculation: regular and overnight shifts. The mode you use is set up in the system setting and may vary for clients.
OT Exclude
The “OT Exclude” column in the TC payroll allocation table is calculated based on the appropriate settings on either the Cost Type, or the State card, or the Employee's TC Configuration card.
First, the system checks if OT is generally allowed for the current employee. It checks the OT Exclude setting on the Employee's TK Configuration card.
If OT Exclude is Yes, then no OT rules can be applied to the employee's time cards: all rows in the allocation table are "OT Exclude = Yes".
The system then checks each row for OT Exclude based on a Cost Type and State. It sets the values Yes and No, respectively.
Rows with 'OT Exclude = Yes' are not included in the overtime calculation.
Minimum Wage Type
When the system has finished calculating the OT Exclude column, it jumps to the calculation wage type.
There is a setting in the WO type to determine a minimum wage type that applies to the TC hours assigned to a WO of that type.
Such payroll allocation rows in a Time Card are included in the calculation of daily/weekly OT and double time. Therefore, if the minimum wage type is OT, the hours worked under the particular WO are OT. However, if the OT limits are set, then any increase above the limit will be double time.
Overtime/Double Daily hours calculation - Regular mode
The regular rule calculates overtime hours under one calendar day. The regular rule applies, even if you add some value to the Overnight column in the Time Card payroll allocation table.
Daily Overtime hours — all hours above the limit of total daily regular hours. This limit is specified in the Daily Overtime (Hrs) field in a Payroll State card.
Daily Double hours — all hours over the limit of total daily overtime hours. The extent is Double Time (Hrs) field in a Payroll State card.
You can also determine overtime and double limits for prevailing wage hours. To do this, open the Payroll State card, switch to the PW Overtime Laws tab and enter the limits.
PW Overtime and Double hours are calculated only within the PW hours.
How it works
Since the system has already set the OT Exclude marker, it proceeds to the calculation of overtime and double hours.
The system calculates OT hours in several cycles.
Skip OT Exclude rows
1. Exclude rows with 'OT Exclude = Yes'.
Calculate PW Overtime and Double hours
2. Take all rows with PW = Yes and OT Exclude = No.
3. Move these rows (if there are any) to the top of the sort .
The rows in the table are arranged in chronological order.
4. Go through the sorted rows and calculate OT.
After placing the PW rows in the correct order, the system iterates over each PW row.
The PW flag is pulled from the Cost Type where it is allowed (the “PW Allowed” setting should be active) or set manually.5. For the PW rows, check the Overtime/Double day settings in the State.
If the Time card is equal to the Overtime day — calculate all given PW rows under this state as overtime.
The same applies to the Double day.
6. If no Overtime/Double day rules are specified, calculate overtime/double daily limits for these PW rows.
6.1 First, it counts PW Double hours
The system totals the PW hours across each row that hasn't been assigned as a double. For example, it doesn't include the row with "Locked Wage Type = Double" in the calculation because we have already defined these hours as double.
It checks to see if the state limit is exceeded for each row added. Once the resulting total exceeds the double daily limit for a State, all hours over the limit are Double hours.
The double hours are applied to the row for which the state has reached the limit.
6.2 Then, knowing the sum of the PW hours, the double hours counted, and the State's PW overtime limit, we can calculate the PW regular and overtime hours.
Here, the system includes the Locked "Overtime" or "Regular" Wage Types in the overtime hours calculation, respectively.
In the same way, the overtime hours are applied to the row for which the state has reached the limit.
Calculate Overtime and Double hours
After the calculation of PW overtime and double hours, the system goes to the next calculation cycle — calculation of regular hours. The scheme is similar to the calculation of PW OT and Double.
7. Take all rows with PW = No and OT Exclude = No.
8. Go through the rows and calculate OT.
Again, one by one, the system picks over each non-PW rows.
9. Calculate Double hours.
The PW hours (if there are any) are taken and summed to a new row in sorted order.
The system doesn't include the row with "Locked Wage Type = Double" in the calculation because we have already defined these hours as double.
As soon as the calculated sum exceeds the state's limit (Daily Double hrs), all hrs above are Double hrs.
The double hours are applied to the row for which the state has reached the limit.
10. Then, knowing the sum of the PW hours, the double hours counted, and the State's overtime limit, we can calculate the regular and overtime hours.
Here, the system includes the Locked "Overtime" or "Regular" Wage Types in the overtime hours calculation, respectively.
In the same way, the overtime hours are applied to the row for which the state has reached the limit.
Overnight Shift Hours
We consider Overnight Shift as a work shift that starts at previous day and ends on the next.
Overnight Shift hours include three possible values:
- Evening — all continuous worked hours starting from the last Clock In for the day, ending 12 am (+/- 1 minute).
- Morning — all continuous worked hours after 12 am (give or take 1 minute) to the nearest Clock Out for the day.
Morning and evening hours describes the uninterrupted work from the Clock In to Clock Out. Hours are pulled from the applied TC adjustment or from Time Entries if the adjustment is missed.
- Empty (Daily) — indicates that first Clock In and last Clock Out occur on the same day.
Put simply, Employee clocked in yesterday, was working during the nighttime hours, clocked out on the next day.
Yesterday hours — evening hours, next day — morning.
Let's view at example.
How do we calculate Overtime and Double Hrs for Overnight Shifts
Overnight Shift Overtime hrs are calculated within the framework of evening + morning.
The combining of evening + morning hrs is total evening hrs for the previous day and total morning hrs for the current, or evening for the current and morning for the next.
So if the sum of evening or morning hrs exceeds the limit of regular hrs set up for a State, we define this difference as overtime. Because overnight shift is always made up of two Time Cards, both may have overtime and double hrs.
The logic of the OT calculation for a shift is similar to the calculation in regular mode. In regular mode, the system iterates over each row in a Time Card.
Here, in shift mode, the system gets all rows for the shift (evening and morning rows) and works with them in the same way as in regular mode.
If a Time Cards has hours not related to the overnight shift, we count overtimes for those hours in the regular way.The combining of evening and morning within the one Time Card are not affect on daily overtime/double hrs calculation.PW Overtime and Double Days limits
The only special moment in the shift mode is the calculation of PW overtime and double hours, if overtime and double days limits are set for a state.
If the shift starts on the Overtime day — calculate all given PW rows within this state as overtime for the entire shift.
The same applies to the Double day.
Example
Let's say, the Overtime day is Saturday and the Double day is Sunday. And no other OT rules are set up (in the Employee's TK Config, Cost Type, etc.)
• Shift from Friday to Saturday — regular hours.
• Shift from Saturday to Sunday — overtime hours.
• Shift from Sunday to Monday — double hours
Let's look at the example of the combining of evening hrs for the previous day and morning for the current day.
The overtime limits for MI and WI states are examples. Use the States reference to set up the actual overtime hours limits.
1. Get the work shift rows.
2. Sidestep OT Exclude = Yes rows.
3. Calculate overtime and double hours for the PW rows.
4. Take non-PW rows. Calculate double hours, then overtime for not-allocated rows.
Update Overtime
Auto-Recalculate
The Recalculate OT/Double Time script runs 3 times a day with the Update FDs script.
Which TCs to recalculate
The script retrieves Time Cards that have been changed since the last recalculation date: manually changed the payroll allocation, time entries, etc.
Then, it hooks adjacent TCs within the same payroll period to calculate OT/Double Time: hooks the previous day's TC to calculate daily OT/Double and the week's TCs to calculate weekly limits.
If a "to be recalculated" TC falls on the beginning of the week, then the script recalculates the TCs for 3 previous days as well.
Manually
Update Overtime action recalculates wage hrs (regular, overtime, double) only for the current TC according to evening hrs in the previous day or morning hrs in the next day.
This button
• does not check the box Lock Allocation.
• does not update the Latest Recalculation date
• does not force update FD. You should update manually in FD card or wait for autoupdate (auto script runs about every 3 hrs).
If you update payroll allocation, TC adjustment in one part (Time Card) of Overnight Shift, you should update the second part (Time Card) to refresh overtime and double hours.Weekly Overtimes
Weekly limits are determined by the Weekly Overtime/PW Weekly Overtime settings in the State card.
To calculate weekly overtime, the system uses the same logic as for calculating daily limits within a Time Card or a work shift. However, in this case, the data sample is Time Cards for the work week.
The start of the week is set up in the work calendar.
Therefore, the system creates a list and places all the Payroll Allocation rows for the week.
1. First, it takes the PW rows to see if there is any PW weekly overtime. Again, the PW rows that exclude OT (if any) go to the top of the list.
2. Then the system takes the non-PW Exclude OT=Yes rows and puts them below the PW rows. It does this because the OT Exclude = Yes rows are considered regular.
3. After sorting the created list, it takes the total of PW hours + non-PW Exclude OT rows and sums over each subsequent row. It applies overtime hours to the rows, that are not allocated as overtime or double. For example, according to the daily limits or the locked wage type.
This means that each summarized row is checked to see if the limit for the State specified in that row is exceeded.
Shifts that occur at the intersection of Weeks/Payroll Periods
There are some specific moments of calculation of overtime/double hours for work shifts that occur at the intersection of weeks or biweekly and monthly payroll periods.
Let's look at a few examples.
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