For Payroll, time-off complications make summer about as special as that first sunburn. It doesn’t have to be that way. Here are some no- or low-cost solutions that can take the sting out of summer.
Exclude vacation pay from overtime and save $$$. Who doesn’t want to take a long weekend during the summer? And, since July 4 falls on a Friday, it’s a safe bet that employees will want the following Monday off, too. Vacation pay is pay for idle time, which isn’t included in the regular rate calculation when figuring nonexempts’ overtime rates. If you include idle time pay in their regular rate calculations, you’ll be overpaying nonexempts, and by a lot.
Example. Donna earns $15 an hour and works eight hours a day. She takes a paid vacation day on Friday; Monday-Thursday she works 45 hours, for a total of 53 hours.
Wrong way: She earns $600 in straight-time pay, $120 in vacation pay and $292.50 in overtime ($15 × 1.5 = $22.50 ove...(register to read more)