Deposit, withdraw hours instead of cash

Overtime banks can offer benefits if administered properly
By Sheila Brawn
|Canadian Payroll Reporter|Last Updated: 09/30/2014

When employees work overtime, some want money for their efforts; others want to be compensated in paid time off. Banking employees’ overtime and allowing them to take the time off later can offer benefits for both employers and employees — if done properly.

For employees, it can mean having a few extra days of vacation or some long weekends. For employers, providing time off in lieu of overtime pay means not having to pay out money right away. It can also be a good employee relations policy. However, without proper policies, record-keeping and communication, overtime banks may cause headaches for employers, payroll departments and employees.

Payroll professionals who work in jurisdictions that have legislated minimum standards for time banks must make sure they understand and comply with the rules. Most Canadian jurisdictions, except for New Brunswick, Nova Scotia, Nunavut and the Canada Labour Code (for federally regulated employers and employees), have established minimum requirements for setting up, running and closing a time bank.