Improper Overtime Scheduling Affects Employee Performance
Small business owners have a steep learning curve to navigate their fledgling enterprises into calmer business waters. From staying abreast of rapidly changing regulations to adjusting prices constantly, your small business plate invariably remains full.
One aspect of running a small business requires little or no learning curve. Worker overtime costs you money that you should allocate to other parts of your small business.
Why pay an employee time and a half, or double his or her wage, when you have several other labor options ready to work. Yet, far too many small business owners fail to detect or don’t even care about employee overtime pay. Paying overtime can immediately turn a tight labor budget into a financial mess.
In addition, constant overtime can take a toll on your employees. We’ll go over employee impact in the following paragraphs.
How do your employees view overtime?
Let’s say you operate a small business that sees wild seasonal swings in sales. For example, landscaping companies enjoy robust sales during the growing season, while window cleaners may see a spring time surge.
The huge increase in customer counts might require you to schedule some of your employees more than 40 hours per week. Some employees get excited about working overtime, but the negative effects of working more than 40 hours per week outweigh a fatter wallet.
Becoming dependent on the extra cash
Employees that consistently work overtime during busier times of the year become dependent on the extra income. It’s human nature to earn more money, and then turn around and spend it on non-essential items, such as movie tickets and designer clothes.
What happens when the busy season ends and the employee returns to a 40-hour workweek? Does the employee reign in the spending or continue to spend like its overtime season?
Paying overtime can cause employees to fall into a debt hole to maintain their overtime pay spending habits.
Overtime takes the quality out of life
Employees that work overtime spend less time with their families. They tend to miss their children’s activities at school, including plays and sporting events. The diminished role a parent assumes due to working overtime can even cause the parent to miss a child’s birthday party.
Working overtime also reduces the amount of time employees have to run errands and take care of life’s basic needs. The balancing act between work and family already takes considerable skill. Working overtime makes it virtually impossible to achieve life balance.
Burnout leaves employees exhausted and overwhelmed with stress. A 2011 study conducted by the Aragon Institute of Health Sciences reported that employees who work overtime increase the risk of burnout by 600% over employees that stay under the 40-hour per week threshold.
The feeling of burnout causes sleep problems, as well as wear the body down enough to make you sick. Burnout also leads to employees leaving your small business for an employer that doesn’t schedule overtime.
Speaking of health issues
A study conducted by the European Heart Journal demonstrated that employees working consecutive 10-hour shifts have a 60% higher chance of developing heart problems.
In addition to heart ailments, employees that work more than 40 hours a week may experience ulcers and symptoms of depression.
On the job injuries
The National Longitudinal Survey of Youth studied the adverse effects of overtime on more than 10,000 American employees. One part of the survey showed that employees who work overtime have a 61% chance of injuring themselves on the job. The percentage rate rapidly climbs for employees that work overtime in dangerous work environments. This negative effect of scheduling overtime puts small business owners at risk of losing expensive lawsuits.
How to prevent scheduling overtime
Paying time and a half (or even double) to employees that work overtime represents an unnecessary business expense. Sure, most small business owners can expect to pay overtime whenever they find themselves in a labor pinch. However, you should schedule overtime as the exception and not the rule.
If you know you experience seasonal surges, plan to hire short-term contract employees in advance of your busy season. That way you have time for training so that when the jobs start rolling in at a high speed you don’t end up pairing inexperienced employees up with veteran employees, causing overtime hours you want to avoid.
Need help scheduling? Learn how you can use technology to help with scheduling.