Record overtime hours is mandatory for companies but also necessary to ensure fair compensation and understand workload excesses in your team. Although overtime is not common, it’s sometimes unavoidable.
However, there are solutions to reduce or eliminate it. The main issue with overtime is that it can burn out and demotivate employees, in addition to representing an extra cost for companies.
With the new working hours control law, organizations are required to keep a daily record of employees’ entry and exit times, as well as overtime hours.
Overtime can be compensated financially or with paid rest but must always be reported to Social Security.
Overtime registration: What the law says
The Ministry of Labor and Economy recognizes and confirms as overtime any work hours performed after the maximum duration of an employee’s ordinary workday.
Usually voluntary, there are cases where a company may require mandatory overtime through individual or collective agreements, with appropriate compensation.
The Ministry of Labor outlines guidelines to ensure that overtime does not harm workers’ well-being:
- Overtime is not allowed during nighttime hours, except in cases of extended special shifts regulated by law or for preventing and repairing extraordinary and urgent damage.
- Minors under 18 are prohibited from working overtime.
- A daily record of hours, through time tracking software or other valid methods, must be maintained to evidence overtime hours.
- A report of hours worked outside regular hours must be generated and attached to the employee’s salary receipt to confirm appropriate compensation.
- Workers’ representatives must be informed monthly by management about the overtime performed by employees, receiving a copy of the time records.
- Overtime can be paid or compensated with rest.
- The amount paid must be equal to or greater than the value of a regular hour.
- Compensation in paid time must be equivalent to the hours worked and within a four-month period.
- The maximum number of overtime hours is 80 per year, unless they are performed to prevent or repair extraordinary and urgent damage, in which case they must be paid.
How to manage overtime and avoid excess
Overtime often occurs due to a temporary increase in company activity or poor time management. To avoid unnecessary overtime, consider the following key strategies:
Understand why employees work extra hours
Are the same people always working overtime? This could indicate an unbalanced distribution of tasks or the result of an employee’s work skills, which can be resolved through dedicated training.
Alternatively, it might be poor time management and work dynamics, which can be understood using time tracking tools. Such tools not only provide the necessary time records but also help measure the time invested in each project or task.
WorkMeter’s time tracking software, automatically and objectively collects each worker’s activity data. Besides recording entry and exit times, it measures work time through indicators such as:
- Entry and exit times
- Actual activity (effective work time)
- Time invested in projects and tasks, detailed by employees
- Project costs and profitability
Only with objective data can you understand how your employees manage their time, helping them optimize it and reduce overtime.
Ensure digital disconnection
The right to digital disconnection is increasingly difficult to guarantee. However, various business management software, including WorkMeter’s software, now feature settings that protect employee well-being through daily pop-up reminders, prompting the end of the workday and the need to disconnect.
These digital disconnection rules, besides guaranteeing a fundamental right for workers, prevent the development and recording of overtime by encouraging employees to end their workday at the appropriate time.
Maintain 100% objective hourly records
Traditional time tracking systems, like time sheets or Excel templates, often contain modified information and time inconsistencies. To avoid subjective manual records, it’s important to implement an automatic time tracking system.
WorkMeter’s management software, being fully automatic, ensures that the collected information is completely objective, preventing unjustified data modifications, inconsistencies, or errors.
This system generates a report that calculates the daily difference between actual activity (effective work) and expected activity. This report allows the exact number of overtime hours to be known and can be exported in different formats for local storage.
Eliminating overtime records may depend more on optimal time management than on balanced workload distribution. This continuous learning process will not only avoid overtime excess but also improve company productivity, provided that the right management tools are in place.
