Though manual methods for tracking employee time are still popular among certain small businesses, many organizations are moving towards implementing an automated timekeeping system.
Most modern time clock devices have functionality that integrates with mobile devices, collects and tracks punch-in data, and notifies management of discrepancies.
With time theft and buddy punching costing thousands of dollars a year, organizations are looking for the best solution that ensures compliance and prevents inaccurate timekeeping records.
When utilizing time systems, it's essential to know the best practices and pick a digital time clock that streamlines work for the entire HR department. This will help save time, money, and valuable resources needed to run a successful business.
Read ahead to learn about timekeeping rules and the best practices to implement an effective and automated time clock system in the workplace.
10 Best Practices for Using an Employee Punch Clock
The responsibility always falls on the employer to track and document employee punch-in data. The Fair Labor Standard Act imposes certain rules that protect workers and hold businesses liable for inaccurate time tracking and underpayments/overpayments.
Because noncompliance can cause several problems for an organization, it's good to know what is needed to ensure all laws are followed.
Employers may choose any type of time recorder as long as collected punch-in data is complete and accurate. Businesses must record the total hours worked of non-exempt (hourly) employees each day and week, the basis on which the employee wages are paid, their regular hourly pay rate, overtime earnings per workweek, and deductions or additions from the worker's wages.
Also, the business cannot dock an employee's pay if he/she does not punch-in on the designated time clock if the employee was working during that time. Read the FLSA standards for more detailed information regarding what an organization needs to do to stay compliant.
Because employers have the ultimate responsibility to track employee time, they must do everything possible to prevent buddy punching or time theft. Buddy punching occurs when an employee clocks in for another employee.
This practice costs organizations across the United States up to 7& of their total payroll expenses. An automatic punch clock or biometric time clock can prevent buddy punching by automating punch-in data and verifying a person's identity while he/she is clocking in.
To stay compliant with FLSA standards and prevent time theft, follow these best practices for using an employee clock app-
1. Be a Good Role Model
Make sure to use the timekeeping devices that are required for hourly workers. If management is also clocking in and out of the app and following the required rules, workers will be more apt to follow suit.
They also won't feel scrutinized or singled out as the only ones who need to follow these policies. Management can lead by example and let workers know that they are also held accountable to the same rules imposed on them.
2. Automate the Entire System
Automated timekeeping devices ensure that real-time, accurate punch-in data is collected and stored in a secure system.
This helps to organize and configure the entire process of verifying time data and prevents the need to scroll through pages of Excel sheets. An automatic time clock system allows businesses to allocate resources more effectively and streamlines the entire payroll process for the HR team.
3. Be Consistent on the Rules
Hourly and salaried employees are treated differently according to FLSA standards. Let workers know what timekeeping policies are required of them depending on their status (exempt vs. non-exempt).
Some exempt employees in law firms or other industries need to clock-in based on how customers are billed. Make sure to check the rules and stay compliant by using a timekeeping device that collects the most accurate and relevant data.
4. Track Time Daily
Don't count on employees remembering time data at the end of the week. Have workers input their time every single day and make sure to record any relevant information that may cause a discrepancy later (i.e. app didn't work/business approved late lunch, etc.).
The HR team should make certain that workers are aware of all of the required punch-in times. Follow up with new employees to ensure they are following all of the rules, and discipline those who consistently forget to clock-in or need an adjustment.
5. Use Simple Categories
Depending on the type of time clock used, time entry data can become confusing. It's best to use categories and features that are as simple and explanatory as possible to avoid problems for the HR clerks when it is time to perform payroll.
For example, enable features such as Remote working On-site, Break, orTraining. This will make it easy and intuitive for workers to track time accurately while saving time for the HR team and preventing guesswork.
6. Tell Employees Why a Timekeeping Device is Used
Time tracking removes the need to micromanage employees by allowing them to manage their hours. Workers should not think that a time clock is a means to control what they are doing at every hour of the day. Make certain to explain the purpose of using a time clock and explain its benefits, including accurate payments, automatic updates, quick time-request approvals, and ensuring compliance with labor laws.
7. Share Information
Be transparent to ensure employees know how timekeeping is being used throughout the organization. This helps to make recruits feel that their place of work is legitimate while assuring that HR is properly handling its duties. Tell workers about the insights generated from reporting and how they help to make better business decisions that affect their well-being along with the company's.
8. Don't Use Notes Frequently
Most time tracking apps or timesheets provide a space for an explanation or note by the worker if there is a discrepancy with their punch-in data. Encourage workers to avoid using this feature unless necessary as it takes up more time for HR to process payroll. Try offering a one-word category option to avoid incurring lengthy explanations. For example, provide categories to check such as Sick, Late, Other.
9. Don't Track Everything
If the organization tries to track every little detail of the worker's day, there's a higher chance that a mistake will be made during payroll. Look at the FLSA standards for required time tracking and follow only what is necessary to maintain accurate time data records. Most organizations track clock-ins, breaks, lunches, and clock-outs, along with overtime hours and absences.
10. Pick a Clock That Solves a Problem
When searching for the perfect time clock, consider what problem areas the organization is facing. Is there an epidemic or buddy punching and time theft? Are workers consistently late? Is it difficult to track remote worker time? Is the HR department spending too much time verifying timesheets and unable to complete other tasks?
Find a solution that resolves the difficulties that are costing the organization time and money. For example, a biometric time clock can help prevent buddy punching by using a human trait to verify a person's identity. A timekeeping app can help track remote or freelance work because it can be integrated with a mobile phone.
In conclusion, here are the key takeaways to remember about using an employee punch clock-
- Businesses may use any time clock they want as long as punch-in data is accurate and complete per FLSA standards.
- Buddy punching and time theft cause an organization's time, money, and resources every year. Using an automated time clock system can help to prevent time theft and hold workers accountable.
- Best practices when implementing a timekeeping system include-be a good role model, automate the entire system, be consistent with the rules, track time daily, use simple categories, tell employees why a time tracking device is used, share information, don't use the Notes section frequently, don't track everything, and pick a clock that solves a problem.