How do I set up Banked Hours for my company?

The banked hours system allows employees to accumulate hours worked beyond their normal schedule to be compensated later.

At Day.io you activate and configure banked hours within the Paid Overtime tab of your pay policy.

There you define start and end dates, expiration cycles, whether the bank is cyclical, how hours are distributed between the bank and overtime, and when balances convert.

These settings ensure compliance with collective agreements while offering flexibility for each company.

1. Activate banked hours

   • Access Pay Policies and open a policy or create a new one.

   • Go to the Paid Overtime tab and turn on the Activate Banked Hours toggle.

   • Specify:

     • Bank start date: when accumulation begins.

       • First due date (Optional): choose a closing date if your company already had a bank.

     • Bank duration: length of each period in months.

       • Cyclical bank (Optional): works with a defined number of cycles (months).
         With each new cycle, the system automatically closes the oldest balance, settling any positive or negative hours from that period.
         Example: if the bank is configured with 3 cycles before restarting. In January, the employee accumulated +10 hours; In February, they accumulated +20 hours; In March, the +10 hours from January are settled, as January reached the end of the cycle.

     • Hide Banked Hours in app: choose whether employees see their balance on the mobile app.

     • Missing days: decide if days without punches reduce the banked hours balance and if they are labeled as Missing Days (for indicators in the platform).
       
       

2. Divide compensation days

   • Choose how to distribute phases:

     • Specific days: Directly indicate which days (Monday to Saturday, Sunday, holidays) are part of each phase.
     • Planned and Non planned days: Use the employee's planned and unplanned days in Schedules as the parameter to each phase.
   • Separate shifts that span more than one day (in cases of shifts ending after 00:00):
     • Calendar: If the phases are divided after the day changes to another day on the calendar.
     • Shifts: If the phases must respect the planned work day, as a single shift.
       
       

3. Configure the compensation method

   • For each phase, choose whether the compensation uses a percentage or a multiplier.

     • A percentage adds a fixed rate (e.g., 50 %). This information will appear in payroll reports and events.

     • A multiplier multiplies the time worked (e.g., ×1, ×1.5, ×2). The multiplied hours are updated in real time for the employee to use.
       Example: 30 minutes of positive balance with a x2 multiplier will become 1 positive hour for the employee.
       
       
       

4. Personalise phases

   • Click New row to add a phase.

   • Choose applicable days and define the percentage or multiplier.

   • Rename the phase for better report readability.

   • To differentiate between night and day periods, click on the Sun/Moon icon.

   • If necessary, set limits and customised distributions.

     • Distribution of hours between banked hours and overtime for the same phase by sliding the slider (e.g., 100% banked, 50% banked / 50% overtime).
     • Daily limit in each phase, defining how many hours can go into the banked hours before being converted to another phase.
       
       

5. Define bank limits (Optional)

   • Used when there is a limit other than daily, regarding how many hours can be acquired in a given phase before being converted to another phase, or converting into overtime.

   • Select the original banked hours phase to be considered.

   • Configure whether the limit will be positive or negative hours.

   • Once exceeded, the surplus is converted into extra hours or transferred to another phase.

   • It is possible to define different limits for different phases, allowing for staggered conversions (for example, +20h to convert Phase A to Phase B, +40h to convert Phase B into overtime).
     
     

6. Activate limit alerts

   • Enable alerts to send notifications when an employee reaches a total of positive hours (daily, weekly or monthly).

   • Alerts serve only as warnings and do not prevent employees from exceeding the total.
     
     

7. Save and finish

   • After completing the settings, click Save.

   • Also configure Night Shift, Tolerance and On Call.

   • Important: only add employees after all settings are completed; after adding them, you cannot edit the policy.

How to reset employees’ Hours Bank balances?

If the company wants to reset employees’ Hours Bank balances starting from a specific date, the recommended approach is to create a new Pay Policy and start using it on the day after the date on which the current Hours Bank should end.

When transferring employees between Pay Policies, the platform allows you to define a new Start date and, when applicable, choose whether the remaining Hours Bank balance should be transferred.

To make the change:

1. Define the last day that should be considered in the current Hours Bank;
2. Create a new Pay Policy;
3. Fully configure the rules of the new policy before adding employees, since the main rules become locked after employees are added;
4. Configure the new policy to start one day after the date on which the Hours Bank should be reset;
5. Go to the Employees tab of the new Pay Policy;
6. Add the employees who will use the new policy;
7. For the Start date, also enter the day after the date on which the previous balance should end;
8. Do not select Transfer remaining bank balance;
9. Confirm the addition of the employees.

Example

If the company wants the previous balance to end on 08/31:

• The current Hours Bank remains valid through 08/31;
• The new Pay Policy must start on 09/01;
• Employees must be added to the new policy with a Start date of 09/01;
• The Transfer remaining bank balance option must remain unchecked.

This way, employees begin following the new Pay Policy without carrying the previous balance into the new period.

Important: the Transfer remaining bank balance option is used when the company wants to keep the balance when transferring an employee between policies. When the goal is to start the new policy without that balance, do not enable the transfer. The availability of the transfer also depends on compatibility between the policy configurations.

Tips and troubleshooting

• Review Start dates, expiration, and duration to make sure the balance is accumulated correctly.
• When using a cyclic Hours Bank, keep in mind that positive or negative balances from previous periods will be closed at the beginning of each new cycle.
• If the hours appear incorrect, check whether employees are assigned to the correct policy and whether the phases and percentages match the intended configuration.
• If the goal is to reset the balance, make sure Transfer remaining bank balance is unchecked before confirming.
• For bulk changes, select all employees who should start the new Hours Bank on the same date.

Best practices

• Inform employees about accumulation and expiration rules.
• Combine percentages and multipliers to adjust compensation according to your needs.
• Review reports periodically and adjust phases according to seasonality or changes in collective agreements.

Frequently asked questions

1. Can I split hours between the Hours Bank and overtime?
   Yes. Adjust the distribution bar to define the percentage of hours that will go to the Hours Bank and to overtime.
2. What happens when the Hours Bank limit is reached?
   The excess balance is converted according to the configured rule: it can become overtime or be transferred to another phase.
3. What is the difference between a percentage and a multiplier?
   A percentage adds a fixed value to each hour for reporting and event purposes, while a multiplier changes the Hours Bank balance in real time (for example: 1h × 1.5 = 1h30).
4. Can I edit the rules after adding employees?
   No. Any adjustment must be made before employees are added to the policy.
5. How do I reset the Hours Bank balance for all employees?
   Create a new Pay Policy, configure it to start on the day after the previous Hours Bank ends, and add the employees on that same date without selecting Transfer remaining bank balance.
6. Which date should I use for the new Pay Policy?
   Use the day after the date on which the previous Hours Bank should end. For example, to end it on 08/31, use 09/01 as the start of the new policy.
7. Which Start date should I enter when adding employees?
   Also use the day after the previous Hours Bank ends.
8. Can I reuse the current Pay Policy for this procedure?
   For this scenario, create a new Pay Policy. In addition to separating the new period, the main rules of a policy can no longer be edited after employees are added.