You can configure [Capping overtime(/time-tracking/working-time-models/capping-overtime/) for each employee.
For example, you can stipulate that a certain number of overtime hours per month are included in the salary. Depending on how many overtime hours the employee works, the system caps a certain number of overtime hours, i.e., it does not carry them over to the next month:
- If the employee does not work more than the configured overtime limit in a month, the system caps the overtime and carries no overtime over.
- If the employee works more than the configured overtime limit in a month, only the number of overtime hours above the limit carry over to the next month.
No exception for a negative overtime balance
If an employee starts a month with a negative overtime balance, the system still applies overtime capping in the next month.
An example:
An employee has capping of up to 5 overtime hours per month configured. The employee has a negative overtime balance of -3 hours at the end of April. If the employee works 4 overtime hours in May, then at the end of May they will not have an overtime balance of 1 h, but will still have a balance of -3 hours.
The reason is: with capping, up to 5 overtime hours per month are included in the salary, and only overtime beyond that counts. Therefore, the 4 overtime hours worked in May are capped and 0 hours are credited.
For the employee to offset the 3 negative hours, they must work 8 overtime hours in one month: the first 5 overtime hours are capped and 3 overtime hours are credited.
Correct approach
At first glance, this calculation may seem wrong or not sensible. On closer inspection, however, it is the correct approach: For the employee, for example, the employment contract stipulates that the monthly salary covers the 40-hour week and up to 5 overtime hours per month as well. In other words: with the salary, the company pays for a performance range of 40 h per week plus 0 to 5 overtime hours per month. The 5 overtime hours are therefore covered by the salary.
If, as an exception, those 5 overtime hours were credited in the case of a negative overtime balance, then the 5 overtime hours would be both covered by the salary and additionally booked as overtime. The overtime would therefore be wrongly counted twice.
What’s more:
An employee could, by cleverly alternating over- and underwork, manage to never work more than the lower limit of only 40 h, yet still always have an overtime balance of 0 in the working time account. In one month they work 5 hours too little, in the next month they work 5 overtime hours, etc.