How I Saved My Company $9,000 in Payroll Expenses

As every manager knows, overtime is a payroll killer. At time and a half for every hour worked after 40, it adds up over the course of a week, month, and year. Therefore, when I was an assistant manager, I made sure my employees clocked in on time and clocked out on time. I didn't want to be responsible for any unauthorized overtime or payroll expenses.

Opening Shift

During a typical opening shift, my employees started arriving between 7:30a.m. and 8 a.m. When I started managing opening shifts, the employees that arrived at 7:30 a.m. clocked in as soon as they reached the time clock whether I needed them on not. This was a huge store expense as most of the employees that worked on day shift received 1.6 hours of overtime every week.

By the end of my second week of opening shifts, I didn't let anyone clock in before 7:50 a.m. I needed my employees on the sales floor 10 minutes early, but not 30 minutes early. At $9 an hour, it was a weekly payroll savings of $67.50. By the end of the year, my new policy had saved the company $3,510.

Mid-Shifts

Mid-shifts are typically used to cover breaks and complete random assignments on the sales floor. The hours ranged from 11 a.m. to 7 p.m. and noon to 8 p.m. depending on what we anticipated for the day. These were also the first employees I let leave early if there was nothing to do. The slow periods typically arrived directly after everyone had been given lunches and breaks which was around 3 p.m. On average, I typically let a mid-shift employee leave early one night a week for a savings of $36. Over the course of the year, that amounted to a savings of $432.

Closing Shifts

When I closed the store, I didn't have any say so as to when employees clocked in for the evening shift. Most of them arrived before I did in order to relieve first shift on time. What I did have control over was when they left. The store I worked at closed at 10 p.m. We usually spent another hour cleaning the store and counting money. On average, I had two high school students and three adults. At 10 p.m., I let the high school kids clock out and leave even though most of them were 18. Just by letting those two employees leave at 10 p.m., I saved $18 a night in payroll, or $4,680 a year.

Generally, everyone else including myself left between 10:45 p.m. and 11 p.m. If the store wasn't finished by 11 p.m., I let two other employees leave. I always kept one other employee until everything was finished for safety reasons, but if we finished at 11:30 p.m. three times a month, it was a savings of $27. Over the course of the year, I saved the company another $5,000 a year in payroll.

All in all, I saved my company almost $9,000 in direct payroll expenses by managing employee hours and letting employees go home early if there was no work.