This Question is Answered

1 "helpful" answer available (4 pts)
Post a new topic
5 Replies Last post: Nov 27, 2007 6:03 PM by Lighthouse24

Company - Personal Loans

Nov 27, 2007 4:34 PM

Click to view HRVegas's profile Start-up HRVegas 3 posts since
Nov 27, 2007
If an employee borrowed money from the company and wants to pay it off by working extra hours (on top of their 40hrs a week), would the time and a half policy go in effect against the loan?

Hope that makes sense.

Thanks all! Cheers!

HRVegas
(Las Vegas, NV)

Report as inappropriate
Click to view FashionGal's profile Founders FashionGal 32 posts since
Jul 29, 2007
1. Re: Company - Personal Loans Nov 27, 2007 4:44 PM
That's a great question. Is it company policy to give out personal loans in the first place? My guess is that it's probably not documented on what to do, thus your question in the forum! I think the most important thing to consider is - ensuring the employee is fully aware of the implications (e.g. overtime or no overtime pay) and you probably want to minimize their extra hours anyway, as working too many hours a week could be counterproductive for them and your company!
Click to view scsurfguy's profile Professional scsurfguy 12 posts since
Oct 18, 2007
2. Re: Company - Personal Loans Nov 27, 2007 4:49 PM

Depending on the situation and the company. If you are a large company than yes, because anything over 40 hrs a week, the law states you have to pay overtime and you have to add that to the payroll, but the money will be deducted back into the company account. "If" there was an agreement signed take back your money. If no paperwork was initialed or signed by the employee and they work extra and don't get paid then they can come after you for back pay. If its completely off the "record" and you trust them to not come back at you, then make them work weekends until the debt is paid. Its really there responsibility to pay you back for a service you provided them. Make sure you have them sign something just in case saying that they will work extra hours non pay, something like interning or volunteer work. Just make sure you cannot get hurt with a lawsuit by that individual saying you did not pay them for their work. Be careful!!
Click to view HRVegas's profile Start-up HRVegas 3 posts since
Nov 27, 2007
3. Re: Company - Personal Loans Nov 27, 2007 4:55 PM
in response to: FashionGal
Thank you FashionGal! :)
Click to view HRVegas's profile Start-up HRVegas 3 posts since
Nov 27, 2007
4. Re: Company - Personal Loans Nov 27, 2007 4:57 PM
in response to: scsurfguy
I think you answered my question scsurfguy. Many thanks!!!!
Click to view Lighthouse24's profile Mogul Lighthouse24 2,396 posts since
Oct 10, 2007
5. Re: Company - Personal Loans Nov 27, 2007 6:03 PM

I see that this question is answered, but I'll add that the loan is essentially an employee benefit. You compensate employees (per your policy) for hours worked, including overtime -- and your records reflect that. You then deduct things like taxes, recreational facility charges, retirement plan contributions, etc. from their gross pay. An employee loan repayment is handled the same way. (Lots of companies, including mine, make loans to employees for specific purchases like computers).