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Statistics report that around 60% of the US workforce prefers working on an hourly basis and is engaged in some types of hourly paid jobs. A majority of such employees are either students or part-time workers seeking to increase their regular income to fulfill their regular expenses.
In addition to a number of employees’ personal inclination towards working on an hourly basis, the new FLSA rules, revised and promulgated by the US Department of Labor in December 2016 have contributed in revising the classification status of a lot of employees.
If you are making less than $47,476 in terms of your monthly earnings and were previously ranked among the exempt category of employees (which means that you were not eligible to receive an extra amount for every overtime hour you worked), then as per the new Fair Labor Standards Act, you are considered as non-exempt and eligible to receive overtimes pays. It has been four months since the revised set of FLSA rules went effective and it has become an ongoing responsibility for the organizations and particularly the HR management to review the payroll processing and monthly wage and hour calculation of their employees. This is an essential responsibility that needs a careful handling and a minor flaw or error in terms of payroll calculation might translate into a huge compliance setback for the organization.
Here’s how the organization can manage their hourly employees, overtimes and wage and hour calculations for the now non-exempt employees while ensuring to optimize their performance and productivity.
Before you proceed to calculate wages and making payrolls, make sure that you have thoroughly revised and determined the new status of your employees. Identify the employees making less than $455 per week so that you can efficiently identify the ones who have become eligible for overtime pays.
The most crucial responsibility on a manager’s part, while managing hourly employees is to ensure that their regular earning justifies their daily performance and productivity. For this, might need to redefine their job roles and descriptions and review their work planning to ensure that they contribute to their utmost potential during their working hours.
Based on the job roles and the nature of work, you will have to determine a new hourly rate for your hourly-paid employees, based on the average number of hours an employee works per week, the overtime hours as well as on their average productivity. An intricate and accurate calculation of hourly rate will help you deduce a fair and feasible wage that justifies the performance and productivity.
When it comes to managing hourly employees, time tracking becomes a crucial responsibility on the manager’s part. You need to ensure that you keep a fair and accurate record of the number of hours worked by each employee. A smart and efficient way to perform this job is to automate it through a smart time and attendance system or workforce management system. This will eliminate the chance of an error in recording and make convenient for you to generate accurate payrolls.