Managing Extra Working Hours and HR Policies for Employee Productivity

Hi Sir/Madam,

I am working as an HR in an IT Company in Mohali. The present employee strength is 20. I have a query regarding Extra Working hours in my office. Our office Timings are from 9:00 am to 6:30 pm. Normally, we allow people to reach the office by 9:20 max. After 9:20 am, if a person arrives without informing, we mark it as a half-day. Recently, we have framed a new policy concerning overtime hours for our Team Members. If anyone works after 7:00 pm, we keep a separate record of those hours daily. If it accumulates to 8 hours in total, we add one leave to their account for that particular month.

I would like to explain this using an example: if an employee leaves the office at 8:00 pm (1 hour added) and the next day arrives at 9:45 am, we deduct those hours from the previous day (meaning they are late by 25 minutes, so subtract 25 minutes from the previous day's hours and so on...). However, personally, I am not convinced about this as I feel we are not able to enforce discipline in the office. Previously, we used to reward the employee every month with the "Star Performer of the Month" award, considering their extra working hours and other parameters.

I would appreciate your guidance regarding this policy. Is it correct? Could you suggest an alternative?

Looking forward to hearing from you soon!

Thanks and Regards,
Divya Manocha HR Manager

Hi Miss. Divya Manocha,

Some IT companies follow the above-mentioned policy to give their workers the advantage of flexible working hours. If you desire to change this, then my suggestion would be that if workers work extra hours, you should either pay them or give them time off, rather than allowing them to come late to the office. This promotes discipline and uniformity. Additionally, just because a worker puts in extra hours does not necessarily mean they are top performers. Therefore, I also request you to redefine your criteria for identifying star performers.

With Regards,
Mr. Thumbs Up

Dear Divya,

The working hours that you have set do not comply with labor laws. You have two options: either adhere strictly to labor laws and begin paying overtime (OT) according to the regulations, or, as you are from an IT company, do not pay any overtime, following the standard practice in the IT industry. Labor authorities usually show leniency towards IT companies regarding extended working hours, considering the project-based nature of their work, which makes it challenging to enforce rigid rules.

However, the concept of carrying forward excess hours/minutes worked by employees is akin to a Savings Bank Account or earning reward points when using a Credit or Debit card. By putting in extra hours, employees in your company are accumulating additional minutes. When employees arrive late, these accumulated minutes will be deducted. Whose idea was this?

Since employees earn minutes for their extended stays, could this system inadvertently encourage a culture of lingering in the office in the evenings? Should the focus be on meeting deliverables or monitoring employees' time accounts?

Given these considerations, I suggest setting the standard working hours from 09:30 to 18:30 with flexibility in place. Each employee should work a minimum of 9 hours, assuming a 5-day workweek.

If employees are working beyond the required hours, have you explored why this is necessary? Is it due to knowledge or skill gaps, flawed processes, or process redundancies within your company? If so, have you documented each process, measured the turnaround time for each, and encouraged employees to maintain detailed "Time Sheets" for analysis to identify time inefficiencies?

There are several issues to address in your current system. Further clarification may be needed.

Thanks,

Dinesh Divekar

Dear Divya,

I concur with Dinesh, and what he has projected through his pertinent queries is, in essence, a clear picture of the lack of effective time management in your establishment. Overtime work is as contagious as a viral fever, and it is normally indicative of inappropriate time scheduling of work. But it does not mean that every employer can do away with overtime work altogether. The type of industry, nature of the work to be performed, timeline set for its effective completion, skill levels of the employees engaged in the work, timely coordination among the different stages of the process, delivery commitments measurable in terms of time as well as quality, and the like are the contributory factors to overtime work in general.

Legal compensation for overtime work is not uniform across the globe. If I am correct, in the U.S., it is 1.5 times the normal rate of wages, in Canada, it is 1.5 times wages plus compensatory time off, and in our country, it is twice the rate of normal wages for working beyond 8/9 hrs in a day. In the case of work on a weekly off, it is overtime rate wages plus a compensatory rest day with normal wages. The reasoning behind such restrictions is to curb the tendency to compel the employee to work beyond normal working hours of the day, as it would not only affect their health but also the quality of the work done. Granting proportionate time off only for the overtime hours is a tacit exploitation of labor and a contravention of the relevant legal provisions. Another pertinent reason to me is that prolific overtime affects employment opportunities.

Allowing grace time for late attendance and granting attendance bonuses, in my personal view, are age-old concepts of incentivizing illiterate labor to be punctual to work. Therefore, adjusting the overtime hours against late attendance would, as suggested by Dinesh, induce the employees to wantonly increase their stay in their seats under the guise of overtime.

In the IT and ITES sector, if the management is clueless about the actual time required for a project and commits to an artificial time schedule for the sake of a continuous inflow of work, it cannot have effective time management.

So, do try sincerely to respond to the queries raised by my learned friend in his post.

Hello Divya Manocha,

Without going into the specifics of the Extra Working Hours Practice of your company that you mentioned, since other members have already given you clear steps to address the aspect, all I would say is something that's fairly simple to address seems to have been made complicated.

Regards,
TS

Hi Divya,

There is no HR policy that is "beneficial for all." It varies from person to person and case to case.

In your policy, you are benefiting people who work late and also arrive late. The people who do not arrive late would not benefit from this policy (unless these leaves are retained beyond the month). Also, people arriving on time and leaving on time are not affected. So, you are actually encouraging employees to come late to work if they have to stay late due to project deadlines.

Employees know that in IT, work is chargeable in terms of "hours," so the culture is cultivated such that "logging hours = working."

In such cases, employees would try to work very calculatively and find loopholes if they can't. Tendencies promote thoughts like, "I worked 20 mins late yesterday, so I can go to the office 20 min late tomorrow," or "I arrived at this exact minute, so I can leave at this particular minute in the evening," or "I will have to be late tomorrow morning, so instead of applying for leave, I will just 'stay back' in the office until late evening today, as I have nothing to do at home anyway."

These effects are seen when HR policies are too detailed about macro calculations. The policies should be guidelines, and deviations should be managed case by case. Your mentioned policy seems to be very detailed about hour calculations on a macro level. This may set up 'rules' for employees but does not clarify your 'expectations' from them.

If possible, try to make the policy simple without calculations and focus on how you can win employee confidence about these policies with transparency in your expectations.

If you take this one step, surely employees would take one as well, and you would see improvement in discipline.

Best Regards,

Amod Bobade.

Hello Divya Manocha,

I think Amod Bobade MEANT "micro" when he mentions 'macro'. And just to add to what he said, 'try to make the policy simple without calculations, and focus on how you can win employee confidence about these policies with transparency in your expectations'... formulate the Policy in such a way to be just a guideline and NOT the Reference Point. Let the employees be THEIR Reference Points vis-a-vis each other. That way you don't need to do daily policing in the long run and there would be a healthy competition among them.

I would also record appreciation of your effort when you are laying down such Policies when your employee headcount is just 20... quite often Companies begin to think of such Policies when things are almost out of control when the headcount reaches much higher figures.

Regards,
TS

Dear Divya,

Please don't mind, if I say, your organisation's policies are just like creation of a zig-zag jungle within the city premises to create mere hurdles for the management as well as the employees. It seems as if your organisation is believer of mere long hours of working of the employees OVER and ABOVE their productivity. Keeping extra working hours of attendance of any employee, as one of the criteria, over and above his productivity to declare an employee "Star Performer of the month" is certainly absurd and a thoughtless idea.

You may better review the organisational policies by questioning yourself :-

1) Whether your organisation prefers productivity on the part of the employees as well as the organisation as a whole ,

OR prefers to waste productive time and energy of management in keeping account of each bit of minutes spent extra on duty and incidents of late arrivals of each employee individually for each day of a month?

2) Whether your organisation wants simplified work processes for the management as well as the employees for the productivity, efficiency and profit for the organisation and incentives for the employees,

OR prefers to waste precious time in petty issues on daily basis?

3) Whether your organisation is desirous of keeping work-life balance of the employees with their increased efficiency, health and happiness of their family life as well as dedication & loyalty of employees resulting in to the enhanced efficiency of the management,

OR to play with the physical & mental health and happiness of the employees & their families, resulting in to the decreased efficiency of the employees and unpredictable losses to the organisation?

If you give answer to the above questions along with description of management’s efforts to enhance productivity of the employees, simplification of work processes and maintenance of work-life balance of employees, I may like to help you with my suggestions towards these factors.

Hey Divya,

Instead of making calculations so trivial, you should directly provide employees with a flexible working hours policy. Give them at least an hour of flexibility to enter and leave the office.

For example, if an employee has an 8-hour workday and enters by 9:00 AM, they can leave the office by 5:00 PM and vice versa.

By offering this option, employees can take advantage of the flexibility. However, there is a risk that someone may misuse it. For instance, if someone plans to arrive at 10:00 AM the next day, they might waste time until 9:00 PM the night before.

Thank you.

Policy on Time:

1. A grace period of 15 minutes is allowed three times in a given month. If an employee is late for the fourth time in the same month, a deduction of half a day's salary may be applied.

2. For overtime work, the calculation should be based on the employee's designation. For instance, if Executives or Low-Level Management work one hour overtime, it should be taken into account. However, for Mid-Level Management or Senior-Level Management, only three hours or more in a day should be considered.

3. Compensatory off (COMP OFF) should be taken within two months from the date of applying.

Ms. Divya is questioning the correctness of the company policy. It is incorrect. Regarding an alternative policy, please refer to the office timing policy available on this site. For Extra Working Hours, you can compensate as per the statutory norms or better. However, adjustments or leniency in office timing should not be entertained.

Hi Divya,

All our learned members have given valuable suggestions. I would like to add a personal experience in a situation very similar to yours. I was in a central PSU posted in one of the stations in the Eastern part of the country. There were about fifty employees, and the staff strength could not be increased because of restrictions from the regional headquarters. The nature of the work was such that very often some employees had to work late into the night. The next day, they had a rostered morning duty starting at, let's say, 6:30 a.m. Thus, the mandatory gap of eleven hours between two shifts could not be given to them as that would have jeopardized the morning work schedule.

What we did was, apart from paying overtime, we used to record the difference between 11 hours and the shortfall. For example, if the employee signed off at 10:30 p.m. and came in at 6:30 a.m. the next day, he got 8 hours of rest instead of 11 hours, and thus, 3 hours were recorded in his account under 'duty time limitation' (DTL).

The rostered duty for all employees was 8 hours. By adding such DTLs to 8 hours, one could take a day off. However, the partial use of DTL of a particular day was not allowed. If an employee had three DTLs of 3 hours each, then he could take one day off, but all three DTLs (equivalent to 3 x 3 = 9 hours) would get extinguished. This had the necessary sanction of auditors and was unique to our particular unit.

Thank you.

A correction to my post: 10th and 11th line should read 'If an employee signed off at 10.30 p.m. and came at 6.30 a.m. the next day...'. By mistake, I wrote 6.30 p.m. instead of 6.30 a.m. Error regretted.

Hi Divya,

Overtime menace is undesirable and, all the same, inevitable too. Many divergent views have been expressed by learned members. I wish to add a different dimension. For certain cadres in Management, there is no concept of overtime (be it Public Sector or Private Sector). If I can take the liberty of coining a new phrase, it is ALL TIME. One is supposed to be ready at all times to attend a plant call/call from the project site, where emergencies are the order of the day!! All the real-time connectivity gadgets have made things worse for the middle and top Management people. Compensation, well, the less said, the better. If you are lucky, your boss may permit you to go early or come late occasionally!!

V.Raghunathan