One of the most valuable metrics a small business owner relies on is time. Time data can indicate what the priorities of a company are as well as inform decisions related to the employee workweek. Most importantly, when small business owners develop and implement time clock systems, they can save themselves all the time it takes to administer manual time clock systems, which require a lot of detailed oversight. When business owners benefit from increased productivity, the entire team stands to benefit. This article will explore time clock best practices that any small business can consider when developing their approach to timekeeping for employees.
Time clock and timekeeping systems
Timekeeping is a process and system for monitoring, tracking, and evaluating the time that employees spend on work-related tasks. Employee time can include any aspect of work time, including project management or administrative work. Generally, time tracking software or other time tracking systems track total hours over the course of a given period, for example, a month or set pay period.
Timekeeping systems track employee time the instant an employee clocks in, and they can record employee hours on a timesheet or time card. With a system that automates work hours, business owners can keep track of lunch breaks or workday periods in addition to other key elements for business owners to monitor, including employee schedules or vacation time accrued.
When introducing a system to track employee time, it is critical to implement a method that business owners are invested in and committed to. Whether utilizing a clock app or a mobile app or more traditional time records, employees need clear communication about how time clock systems work and general expectations for record keeping. Clear communication will ensure that employees make use of time clock systems in real-time with more accurate data that can help monitor labor costs and ease payroll processing.
The importance of time clock systems
Time clock systems are important for successful business operation, especially for small businesses that may have to consider a variety of employee types, such as exempt employees, non-exempt employees, hourly employees, and new employees. Companies and businesses that execute structured time tracking systems benefit in a variety of ways. Essential aspects of time clock systems that support overall business productivity and success are listed below.
Time clock systems help manage and prevent loss of valuable time.
Automated time tracking software can provide a larger picture of how members of the company are spending their time. By understanding how employees spend time, business owners can better anticipate the cost of certain projects, the value of services, and even consider new strategic directions for tasks that take up a lot of time. For example, if a task that an employee takes on is using a lot of time, considering options for automation could be the direction a business may want to take.
Minimizes loss or waste of financial means.
Time clock tracking ties directly into other business metrics that small business leaders may monitor, such as revenues, and expenses, etc. With time clock systems, business owners can have access to real-time data that can show areas of operation that are chipping away at potential areas for profitability. For example, if an employee is taking extra time to work on a specific project, the overtime pay amount is going to be more costly. With this information, businesses can make strategic decisions about project time and how they can best save money over a given period.
Helps you comply with tax requirements and compliance regulations.
Automated software for time tracking is designed with tax requirements and compliance regulations in mind. As a result, companies that integrate time clock systems are able to ensure that employees are working the specified number of hours and that time records are accurate for hours worked. For example, the Fair Labor Standards Act set a minimum wage that all companies are required to follow. Time records detail payment for hours worked, including wages, which meet regulatory oversight in this area. In conjunction with wage reporting, time clocks are essential for payroll data
and payroll processing, and enabling the integration of these two systems will promote better overall business record keeping.
Keeps records transparent between employees and employers.
Employers and employees alike can track their time and have a more accurate expectation for paychecks and time card processing. In the case of a discrepancy, the transparency of records can help resolve any possible areas of disagreement. Another important benefit with transparent records is automation. Automated time clock systems can help prevent time theft and buddy punching with new technology, such as biometric credentials to clock in. That way, employers can have peace of mind that there are security measures with time clock systems to avoid losing financial assets and means.
Helps you see what priorities are present for the company and how time is being used.
A time clock system can support business owners to identify the number of hours worked and overtime pay in various areas of business. From this time data, business leaders can set strategic direction for what is important to the company's bottom line. From a managerial perspective, managers can have a greater sense of how employees are spending their time and where employees may need additional support or training. Thus, priorities include not only those that set business direction, but consider the needs of team members for improved efficiency and overall work culture.
5 time clock best practices for small businesses
Once a time clock system is in place, there are five key best practices to follow for successful implementation, use, and value to workplace processes and operation. The five time clock best practices are as follows:
1. Consider, evaluate, and follow through with the method of recording time no matter what system you implement.
However a small business decides to record and track time, it is imperative that the system is consistent across teams, departments, and all employee types. If a business does not use a time clock system consistently, it will lose the reporting benefits and could likely lose money in the process. The business owner should choose its method of recording time based on business needs and business size. Employees can access time tracking solutions through browsers, mobile apps, or even through POS systems. Once the method is implemented, owners should monitor engagement and use by staff to make sure the company at large is adopting the system.
2. Use reporting systems to get the most out of your time keeping strategy.
You can get a sense of budgeting, overtime, expenses, and more. Time and attendance systems are complex in that they collect a variety of data points and provide them to users with the necessary permissions. Business owners can generate reports with this critical time data, and it is important that time tracking software include a variety of report options that benefit your specific business. Reporting can include total hours worked, time off, break times, wages earned, tax rates, and other metrics relevant for human resources needs. When securing a time tracking solution, it is critical to check for reporting options so that you have the capability to pull the right data for your small business.
3. Invest in an automated system so that you have a more accurate view of how time and attendance is working at your company.
No matter what approach your time clock system takes, automation allows for accuracy that manual time clock tracking is unable to capture. In addition to more accurate data, business owners can save human resources time from having to calculate and track employee hours by hand.
4. Include time and attendance tracking as part of your onboarding experience for employees.
Employees should learn what the expectations are with time clock systems the minute they begin employment. Better yet, new employees can adopt the system immediately without having to transition from an older time clock system. So, when bringing a new employee to the team, make sure there is time set aside to talk about how to track time and how to clock in and clock out.
5. Roll out a time clock system for all employee types.
For effective time clock use, it is necessary for employees of all types to be on board, whether working at the executive, managerial, or administrative level. Small business owners can promote time clock system usage and adoption by explaining that time clock management aims to help show the big picture of what is going well with business projects and what needs more support. When employees at differing levels of the organization can see that employees higher up are also engaging with the time clock, there is an increased incentive to use it on a regular basis.