The U.S. Department of Labor says 78 million Americans – about 59% of the workforce – punch a time clock every day.
And oh, the mess they make!
If your company has hourly workers, you know that keeping track of time and attendance is a challenge. An employee might inflate hours or forget to clock out during breaks. Those lost hours could lead to missed deadlines or a lack of shift coverage, affecting your bottom line.
In fact, businesses lose 1.5% to 5% of gross payroll to time clock fraud each year.
Attendance issues also impact morale. Employees who see coworkers arriving late or leaving early can become disengaged and resentful. If the problem is left alone for too long, your company may even develop a culture of absenteeism.
When you’re trying to solve these issues, it’s important to remember that employees are not solely to blame. Your business is ultimately the one responsible for maintaining a clear and concise attendance policy, as well as setting up a time and attendance system that is both convenient and accurate.
Consider how you record employee time: Do you use pen and paper timesheets, which are easy to lose or alter? Do you have a mechanical punch clock, which can break down? Even spreadsheets are at the mercy of complicated formulas and typing errors.
Whether you’re managing factory workers in several locations, a virtual team of knowledge workers or sales staff who are out meeting clients, you need more than timesheets and a punch clock to keep everyone accountable for their hours.
Save yourself money — and time — by switching to time clock software.
What is time clock software?
Time clock software tracks employee attendance, schedules and paid time off (PTO). Employees can clock in and out with key cards, mobile phones, biometric devices and other data-capturing methods. Times are recorded in a database and can be used to generate reports and streamline payroll.
Time clock software is also known as timesheet, time tracking, or time and attendance software. It’s usually offered as either a standalone product or integrated with a human resource management system (HRMS) or accounting software.
If you’re new to time clock software, here are seven features that can help solve your company’s attendance issues:
1. Accurate clock-in and clock-out
Tracking when employees start and end work each day isn’t easy. Handwritten timesheets and mechanical punch cards are difficult to verify and can become hotbeds for future disputes.
For example, over 75% of companies in the United States lose money to buddy punching, which occurs when coworkers clock in or out for each other at work.
Time clock software eliminates buddy punching using the following features:
- Cameras that require the worker to take a photo
- Pads for workers to enter a passcode or provide their e-signature
- Biometric devices that scan employee fingerprints, faces or voices
Managers can be alerted when employees start and end, and lockout periods prevent employees from clocking in or out at inappropriate times.
Together, these features verify the worker and times with greater accuracy than traditional methods.
2. Trustworthy time records
Have you ever wondered if an employee made changes to his timesheet? Or has an employee claimed that she wasn’t paid for the correct number of hours she worked?
Disputes like these happen when time records aren’t secure, and they can waste everyone’s time.
Time clock software records and stores information in a database that can’t be altered by employees or managers. This means fewer surprises for everyone at the company.
In addition, because employees have access to their time records, they can more accurately estimate their future wages. Managers also have a reliable source of information when providing feedback and performance reviews.
3. Access from mobile devices
These days, workers are increasingly remote. In fact, over four million employees now work from home at least half the time. But keeping track of offsite employee hours can be a difficult task.
With time clock software, employees can clock in and out from mobile devices and computers, whether or not they’re at the office.
Some products also feature automatic screen capturing, which estimates the amount of time a remote employee spends on non-work related activities.
Even for on-site employees, the ability to enter times from mobile devices or computers lets them avoid having to walk past a physical kiosk or station.
4. Track employee locations
If your company has employees who travel regularly, such as salespeople and utility workers, you want to be sure that they’re starting and ending their days at the right locations.
Time clock software uses GPS technology to record where an employee is at clock-in and clock-out, which keeps everyone honest and even helps with your customers.
For example, suppose you have a field worker whose hours you bill directly to a client. The worker can clock in at the customer site using her mobile device. Because both the time and her location are recorded, you can feel confident when you invoice your customer and refer to the database if there’s a dispute.
Another GPS feature is geofencing. Managers can draw a digital perimeter around a particular area and track when an employee enters and leaves that area. Geofencing helps your company monitor workers that move around a specific location, such as a construction site.
5. Streamline PTO and scheduling
Scheduling can be a headache, especially for businesses with complex schedules and a lot of employees. You want to be certain that you have full shift coverage, while taking into account employee availability, time off requests and overtime.
Time clock software offers several features to reduce the stress of scheduling.
Using a self-service portal, employees can enter their availability and request vacation and sick leave. Managers can view and approve these requests, as well as plan employee schedules through a single interface.
The software also keeps track of PTO accrual and usage, and schedules can be automatically synced with employee calendars.
6. Improve reporting and analytics
There will always be extenuating circumstances — unexpected traffic or a family emergency — when an employee comes late to work. As a manager, however, it can be difficult to know when lateness is a one-time event or consistent behavior.
Time clock software lets you generate reports for employee start and end times, so that it’s easy to see if there is a pattern or trend. This allows you to address a specific issue and provide a relevant solution.
Managers can also use reports to analyze which activities require the most employee hours or how much labor is used by each department. With this data, you can improve project scheduling, manage overtime or bill a client.
7. Integrate with payroll
In the past, accountants would collect employee punch cards, count the hours, and compute wages by hand or using spreadsheets. For a large company, this inefficient and error-prone process could take days.
With time clock software, managers can review expected versus actual hours. After approval, employee time information is transferred directly to payroll software where wages are automatically calculated.
For businesses trying to comply with the Fair Labor Standards Act and prevent employee lawsuits, this process reduces the time and risk involved with manual data entry and calculation and provides a paperless audit trail.
Your company is only as productive as its employees. If you’re using an outdated time tracking system, you’re not only hurting the morale of your employees but also your business.
Time clock software — in conjunction with a clear and consistent time and attendance policy — takes the pressure off everyone to be honest, because employees and managers can trust that the system is secure and auditable. Disputes and conflicts should be minimized, and everyone can focus on the work at hand.
If you haven’t looked into this technology yet, it’s not too late. For a more details, check out our comprehensive guide to time clock software.