Overtime Policy in Zoho People timesheet service helps you track and calculate employees’ regular, overtime and double time (extended overtime) hours and help facilitate pay based on time log hours recorded in a day, week, weekend, holiday, and consecutive workdays. You can define overtime pay rates using the employee’s wage rate or as a multiple of their regular hourly pay. This helps automate overtime calculations and ensures accurate overtime pay for your employees.

To configure overtime policy based on employees attendance hours, refer to Configure Attendance Based Overtime Policy.

Overtime Compliance Policies

Compliance policies are available for all 50 states and 2 territories (Puerto Rico and District of Columbia (D.C.) of United States of America

To apply the compliance policy to employees in a specific state, ensure that no other overtime policy (user specific, location-based, employment type-based, department-based) is assigned to them. This allows the system to correctly prioritize the compliance-based policy

Enable Overtime Compliance Policies

To apply Overtime Compliance Policies to your employees:

1. Navigate to Settings > Timesheet > Configuration > Overtime Policies > Overtime Compliance Policies.
   
   
   
   
2. Enable the required compliance policy to apply it to the respective state. The policy will apply to employees in all locations within that state.
   

   

   To view the overtime compliance policy rules, click on the required state policy. 
   
   
   All the added locations that are tagged to the US State and United States country will be auto-applicable to the compliance policy when enabled.

3. The employees’ overtime data will be recorded according to the rules specified in the compliance policy and will be available in the overtime report. To view the Overtime Report, click here.

To configure employee wage rate, refer to  Employees Wage Rate. 

Add Overtime Policy

1. Navigate to Settings > Timesheet > Configuration > Overtime Policies > Add Overtime Policy.
   
   
   
   
2. Enter the policy name.
   
   
   
3. Select policy applicability based on specific user, employment type, location, or department.

   When an employee qualifies for multiple overtime (OT) policies, the system determines the applicable policy based on the following priority order:
   
   

   (i) User-Specific Policy (Highest Priority): If an OT policy is directly assigned to the employee, it takes precedence over all other applicable policies.
   
   

   (ii) Employment Type-Based Policy (Second Priority): If employment type based OT policy is applicable, such as full-time, part-time, or contractual, it is considered next to user specific.
   
   

   (iii) Location-Based Policy (Third Priority): If a location-based OT policy is applicable, such as Chennai, Bangalore, it is considered after employment type-based policies.
   
   

   (iv) Department-Based Policy (Fourth Priority): If a department-based OT policy is applicable, such as Engineering, HR, it is considered after location-based policies.
   
   (v) Compliance Based Policy (Fifth Priority): If a compliance-based policy is applicable to employees, it will be considered after location-based policies.
4. Configure overtime pay rates for overtime and double time hours. Defining overtime pay rates helps calculate the overtime amount and display it in reports.
1. In multiples of regular Rate Per Hour (RPH): This option allows you to define overtime rates based on employees regular rate per hour set in the Employees Wage Rate.
2. Based on employee's wage rate: This option applies the overtime rates based on employees' overtime and double time (extended overtime) rates set in the Employees Wage Rate. 
   
   
   
5. Enable and set required overtime rules:
   
1. Daily Overtime: Enable and configure to track employees' daily regular overtime and double time hours.
   
   
   For example, time logs exceeding 08:00 hours/day can be recorded as overtime and exceeding 10:00 hours/day as double time.
   
   
2. Weekly Overtime: Enable and configure to track employees' weekly overtime and double time hours. Weekly overtime are calculated per calendar week.
   
   
   
   
   For example, time logs exceeding 40:00 hours/week can be recorded as overtime and exceeding 48:00 hours/week as double time.
   
   
3. Weekend Overtime: Enable and configure to track employees' weekend overtime and double time hours. 
   
   
   
   For example, time logs exceeding 0:00 hours on a weekend can be recorded as overtime and exceeding 8:00 hours as double time.
   
   
4. Holiday Overtime: Enable and configure to track employees' holiday overtime and double time hours. 
   
   
   
   For example, time logs exceeding 0:00 hours on a holiday can be recorded as overtime and exceeding 8:00 hours as double time.
   
   
5. Consecutive Workday Overtime: Enable and configure this setting to track employees’ overtime and double time hours based on consecutive workday time log hours. This is useful when employees work continuously without a day off and helps ensure additional compensation for extended work.
   

   

   This rule applies only to the 7th consecutive workday.

   
   

   
   
6. Upon configuring the required overtime rules, click on Add.
   The overtime policy will be added and will apply to applicable employees.

Clone Overtime Policy

To clone an existing overtime policy and  create a new one:

1. Navigate to Settings > Timesheet > Configuration > Overtime Policies.
   
   
   
   
   
2. Click All or Overtime Compliance Policies, depending on from where you want to clone the policy.
3. Hover over the desired overtime policy and click Clone.
   
4. Customize the overtime policy based on your organizational preference.
   
5. Click Add to save the policy.
   

View and Export Overtime Report

To view and export employees overtime data based on the timesheet overtime policy:

1. Navigate to Reports > Organization Reports > Timesheet Data for payroll.
   
   
   
   
2. Apply the filter as required and click Submit.
   
   
   
   
   
   
3. Click on the employee's overtime record to view their detailed overtime report for the selected period.
4. Click on the ellipsis icon to export, download as pdf and print the report.
   

Delete Overtime Policy

To delete the overtime policy:

You cannot delete enabled Overtime Compliance Policies, they can only be disabled.

1. Navigate to Settings > Timesheet > Configuration > Overtime Policies.
   
   
   
2. Click on All tab.
   
3. Hove over the overtime policy and click Delete > Confirm.
   

Example 

Learn how to enable the compliance-based overtime policy for California state, USA

To apply the California overtime policy to employees tagged to the state of California, ensure that no other overtime policies are configured or applicable for employees in that location.

You can add the California overtime policy by selecting it from the preset compliance-based overtime policies:

1. Navigate to Settings > Timesheet > Configuration > Overtime Policies.
   
   
   
   
2. Click the Overtime Compliance Policies tab.
3. Enable the California Overtime Policy.
   
   

   The overtime policy will automatically apply to all locations tagged to California in Zoho People, such as Los Angeles, San Bernardino, Riverside, Santa Barbara, and others.
4. Click the policy to view the overtime rules defined for California state based on labor regulations.
   
   
   
   
   
   
5. Click on the Employee Wage Rate to configure the hourly rate for employees in your organization.
   
   

The overtime will be calculated based on employees' time log hours, and the hours will be captured in the timesheet data for payroll report.

Employee Overtime Calculation Based on California Policy

Weekly overtime summary:

Day	Total Time Log Hours	Regular hours	Overtime Hours	Double Time Hours
Monday	10	8	2	0
Tuesday	8	8	0	0
Wednesday	12	8	4	0
Thursday	11	8	3	0
Friday	8	8	0	0
Saturday	8	0	8	0
Sunday (7th Consecutive)	10	0	8	2
Total	67	40	25	2

Rate Details:

Employee Regular Rate Per Hour: 30 USD

Overtime is paid at 1.5x Regular rate per hour (1.5 x 30 = 45 USD)

Double time is paid at 2x Regular rate per hour (2 x 30 = 60 USD)

Weekly Payment Summary:

Total regular hours for the week =  40 hours

Total overtime hours for the week = 25 hours

Total double time hours for the week = 2 hours

Category	Amount (USD)
Regular amount	40 x 30 =1200
Overtime amount	25 x 45 = 1125
Double time amount	2 x 60 = 120

To view the overtime report, navigate to Settings > Reports > Organizational Reports > Timesheet data for payroll. For more information, refer to View and Export Overtime Report.