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Most firms are concerned about paying hourly employees “over-time”. I never was concerned about A & E OVERTIME.

Happy Employees 

5-10 hours of overtime per week makes most employees happy. But, any more than that, makes them less productive.

Greater Profits

I believe that limited over-time actually improves your bottom line.

Your employee’s hourly billing rate should be 2.5 to 3 times what you actually pay him, in order to cover benefits, taxes, overhead and profit. If you pay an employee $60/hour, his billing rate is about $175. That rate covers all the items listed, based on a 40 hour work week. If he works overtime, you pay him $60 x 1.5 = $90 plus a little extra in payroll taxes, electricity and heat. But the cost to you, for that extra hour, is a lot less than $175.


Adjust your work load so that your employees will be working 5-10 hours of overtime each week and it will increase your bottom line.

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Excerpted from The “Complete Guide” to CONSULTING ENGINEERING © 2015 John D. Gaskell. Used with permission of Professional Value Books, Inc. All rights reserved. See DISCLAIMER and order at Use discount code “paperback” and save.