This article explains how to create overtime policies in Personio. Overtime policies define the rules for calculating and tracking your employees' overtime. After you create a policy, you assign it to employees so their overtime is recorded consistently.

Before you start

• To create overtime policies, you need Edit permissions for Account configuration > Attendance.
• You only need to create and assign overtime policies if your employees actively track overtime.
• We recommend not assigning an overtime policy to employees with an hourly salary, as the system already accounts for every additional hour they work.

Create an overtime policy

Follow these steps:

1. Go to Settings.
2. In the Time off & attendance section, click Attendance.
3. Below Policies, click Overtime.
4. In the top-right corner, click New overtime policy.
5. Add a name and description for your policy. We recommend using a descriptive name to help you identify the policy settings, and a description with more details. For example: "Daily overtime, deficit off".
6. Set up your policy rules, referring to the descriptions below.
7. Save the policy.

Overtime settings summary

The following section describes each overtime policy setting and how it affects overtime calculation.

Calculate overtime

Choose how often to settle overtime hours: daily or weekly.

• With daily calculation, overtime is measured each day. For example, if your target is 8 hours, and you work 10, you earn 2 overtime hours.
• With weekly calculation, overtime is measured across the whole week, so longer days can be balanced out by shorter ones. For example, if your weekly target is 40 hours, and you hit exactly 40 across five varied days, no overtime is counted.

Deficit hours

Only enable the Track deficit hours if someone works fewer than expected hours option if your employees are actively tracking time, as the system starts tracking deficit hours immediately.

When you enable this option:

• If an employee tracks fewer hours than planned on a workday, the system creates a deficit entry for the shortfall and subtracts it from their overtime balance.
• Employees can track a 0h day in the Attendance panel.
• The setting Automatically record a full deficit on days with no tracked time, described below, becomes available.

Automatically record a full deficit on days with no tracked time

This setting is only available after enabling the Track deficit hours if someone works fewer than expected hours setting and when calculating overtime daily.

When you enable this option and an employee tracks no hours at all on a workday, the system creates a deficit entry for the whole amount and subtracts it from their overtime balance.

Keep in mind:

• Only enable this option if your employees are actively tracking time, as the system starts tracking deficit hours immediately.
• To avoid employees' time off from being calculated as deficit hours, activate the Reduce target hours and count any time tracked as overtime during time off? setting for the relevant time off types.

Overtime balance limit

If you enable the Add a limit to total overtime balance option:

• The system alerts people when their overtime balance is about to reach the set hours limit.
• You can quickly see which employees are nearing or surpassing their overtime limit. Go to the People list and add the Overtime balance column.

Monthly overtime cliff

Define the number of overtime hours already covered by the monthly salary. Keep in mind:

• The system adds the monthly cliff at the start of every month.
• Overtime starts accruing only after employees reach this amount.
• If an employee begins the month with a negative overtime balance, the current month's cliff applies before their balance returns to zero. In other words, overtime hours offset against the cliff first, and the negative balance second.
• If you want the system to offset the negative first instead, Account Owners can contact our Customer Support.

Next steps

Assign overtime policies to employees.