Managing employee overtime is low hanging fruit when it comes to ways to reduce costs.

By Pam McDonald

With increasing wage and revenue pressure across senior living, executives are focusing on cost control strategies. Jim Rubadue, Vice President of Customer Success for OnShift, a leader in human capital management software for senior living and a Senior Housing Forum partner, notes that managing employee overtime is low hanging fruit when it comes to ways to reduce costs. After all, labor is a senior living organization’s top expense, typically representing about 60% of the operating budget.

With strategies in place to control overtime, even a minor reduction can lead to significant savings. Jim offers 5 tips to keep your overtime budget under control.

  1. Plan the schedule 3-4 weeks in advance

    Jim notes, “As in so many other scheduling situations, the key is having a realistic, advance view of the schedule. This gives you a chance to make smart, informed decisions that minimize the need for overtime, and to better distribute overtime when extra hours are unavoidable.” By planning employee schedules in advance, community leaders can work their scheduling data and avoid building overtime right into their schedules.

  1. Communicate your overtime target

    “In your community, what is an acceptable level of overtime?” Jim asks. “In my experience, levels of about 2% are common.” One of the first steps executives should take is to determine a level that makes sense for their organization. It’s critical for schedulers and executive directors to know what the overtime target is so they can stay on top of it. As a next step, communicate the target in terms of hours, so the person doing the scheduling can make shift adjustments to stay at or below the goal.

  1. Review the schedule daily

    As Jim is quick to point out, a staffing schedule is a living thing, subject to unexpected changes. He says, “Schedulers should review the schedule every day, even every shift, making adjustments to avoid piling hours onto those who have already accrued overtime.”

    Getting visibility into overtime before it happens is critical in keeping overtime under control. For example, changes in occupancy can have a significant impact on staffing. Be sure to review move-ins and move-outs in advance, as much as possible, to get a heads-up on when extra staff may be necessary. In that way, overtime can be avoided. In addition, when occupancy takes a dip, you may have an opportunity to cut a shift or two, thereby reducing your overall labor costs,” Jim adds.

  1. Use your part-time staff

    When allocating shifts and extra hours, make sure you consider part-time staff.

    Jim states, “You’re likely to find that employees beyond a core pool of go-to overtime workers are interested in picking up the extra time. I’ve seen many organizations that operate with significant overtime, but underutilized their part-time employees.”

    In addition, be sure to review how well full-time employees are utilized. “I’m surprised at how often full-time employees are working less than their full-time hours. It’s important that staff get the hours that they anticipated when they took the job,” adds Jim. Look to your under-utilized full-time workers when shifts become available before allocating shift to those who would incur overtime hours.

  1. Communicate open shifts broadly

    “If there is no way around the overtime,” Jim says, “make sure you communicate the available shifts beyond your go-to group. That gives all employees an opportunity to pick up an extra shift. By more evenly sharing overtime you’re not only driving down costs, but you are also showing transparency.

    “You will find that staff members appreciate open communications and opportunities to pick up shifts, even if they are not available. Beyond overtime control, a boost to staff satisfaction is a big win for any senior care community,” he says.

    The key to controlling overtime is to have a plan in place and be proactive, making sure that schedules are reviewed and adjusted on a daily basis. Consider these tips to get on a path to lower costs by managing your overtime day in and day out.

Learn how OnShift’s staff scheduling and labor management software can help senior living providers proactively control overtime by visiting