A Compensatory Time-off Plan
Organizations use a structured policy or arrangement known as a compensatory time-off plan, also known as a comp-time plan, to give employees the option to accumulate and use additional time off in place of overtime pay. Employees can use compensatory time off accrued outside of their regular schedule to take paid time off later under this plan. The arrangement regularly frames the standards, rules, and methods for procuring, following, and using compensatory downtime.
Under a compensatory time-off plan, employees might build comp-time hours in view of a foreordained proportion, for example, one hour of compensatory downtime for each hour worked past the ordinary timetable. The maximum amount of comp-time that can be accrued, as well as any restrictions on when and how the accumulated time off can be used, may be specified in the plan.
Compensatory time-off plans are in many cases administered by work regulations and guidelines to guarantee consistence with fair work rehearses. Maximum accrual limits, time frames for using accrued time off, and the requirement to compensate employees for unutilized comp-time upon termination must all be adhered to by the plan.
In short, a structured policy or arrangement known as a compensatory time-off plan allows employees to accumulate and use additional paid time off in lieu of receiving overtime pay. The plan ensures compliance with labour laws and establishes the guidelines for obtaining and making use of compensatory time off. It offers an alternative to monetary compensation for additional hours worked and allows employees to manage their work-life balance.