Tuesday, December 20, 2011

How Does PTO Impact Overtime Pay at a Dental Office?

We are trying to figure out how to handle this week as we are a startup practice.  We are paying for holidays so our employees will get 8 hours of pay for today.  Tomorrow the office is closed and they can use paid time off (PTO). How do most people handle PTO if it would cause your employees to go into overtime for the week?  Do you cap the number of hours the employee can elect to use so they can't go over 40?

You may not know this, OT is due on hours actually WORKED.

So in your example, let’s assume someone worked 25 hours Monday- Wednesday and you give them 16 hours of benefit time for Thursday and Friday. That’s 41 hours; however, they only WORKED 25 hours and therefore, you would simply pay them straight time for all 41 hours, OT of 1.5 x their hourly rate is NOT necessary in this example.

This first appeared on Dentaltown.

Send your questions to Tim Lott, CPA, CVA at tlott@dentalcpas.com

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