Leverage These Best Practices to Manage Time Tracking Process
Time tracking management can be a daunting task for payroll professionals, but partnership with a vendor of time tracking tools and technology helps with automation of the process and will ease administrative duties.
Payroll professionals have many things to consider when selecting and implementing time tracking systems that will provide compliance, data storage, reporting, data accuracy, technology, integration, and ease of configuration. The good news is many systems now provide these features, as well as the support, for payroll to manage the process. These time tracking solutions help manage more than just time punches; they can also assist management with making critical business decisions.
Most payroll professionals are familiar with core federal overtime requirements. However, depending on how many state or provincial laws and regulations affect your business, you need to ensure the system can easily handle these additional requirements.
For example, states such as Nevada or California have additional rules that impact overtime calculations. There are also special overtime rules that may apply in a state and impact certain businesses, such as Connecticut's mandate that restaurant and hotel employees be paid at least 1.5 times their regular rate of pay for all time worked on the seventh consecutive day of work. These considerations may mean a unique set of time tracking needs for a business that must be taken into account when designing, auditing, or setting up a time tracking process.
Another area of compliance to consider with time tracking includes scheduling the time for work or attending meetings. Situations may occur where an employee’s actual time worked must be compared to the employee’s scheduled time worked. Instances of on-call time, travel time, report-in time, and split shift time may be difficult to manage if not tracked within a system or processed properly. Some of these items will require additional payments to employees and will need to be tied closely to the payroll system. It is important that a time tracking system will produce data that results in correct compliance for your employer and the payroll team.
DATA STORAGE, REPORTING CONSIDERATIONS
There are federal and state requirements governing how time tracking data is stored and accessed, so payroll professionals should research what data items must be stored, how they can be retrieved, how long they must be kept, and when they can be disposed of.
How and where data are stored in the system can determine how difficult it may be to generate a report. Depending on the size of the business, storing time punch data, including in or out punch data, time edits, time approvals, and other details may require millions of bytes of storage. This is why it is critical that data storage is maintained properly to ensure reports can be efficiently and easily accessed.
DATA ACCURACY CONSIDERATIONS
Accuracy of the time tracking process is imperative to the success of a company’s payroll department. It enables payroll professionals to avoid missed time clock data, as well as track and eliminate instances of buddy punching, double punching within seconds, or other issues that could create inaccurate payments. Special situations like daylight saving time must be considered to ensure accuracy, and if there are multiple shifts, the system must ensure the system can manage tracking time for each shift properly to report to the payroll system.
Time tracking is helpful with job costing, which involves the collection and representation of a company's expenditures (including labor) for a specific job or function. It requires accurately assigning a cost to a specific job so that a company's accounting reflects the true cost of an activity. Job costing can involve employees, associates, or contractors working on multiple projects or at multiple job locations; a time tracking system can help with this.
The selection and integration of the appropriate time tracking system can either help ensure the accuracy of payroll or lead to incorrect payments to employees. That is why it is important to review all elements of a time tracking system being considered. In today’s world of ever-changing technology, there are many solutions to choose from, so it is imperative to research and select the best solution that meets your individual business needs. Some of these needs may include special types of trackable payments and any data necessary to make that payment. This will help determine if the solution or process will help aid the payroll process and the business.
This technology may also include the ability to utilize or connect with mobile devices, self-service, ad hoc reporting, and real-time calculations. It will help manage labor costs by providing easy visibility of the details at the manager’s fingertips. The right system will provide flexibility for time tracking approvals and make the process smooth for the employee and the manager, which will help payroll processing occur on time.
Time tracking equipment is also much more advanced than it has ever been in the past. Today, biometric readers can be installed to clock in and out using a simple fingerprint or swiping a security badge. Tools using GPS tracking are also available and very effective for employees who are on the move and whose location must be tracked.
Additional features to watch for with time tracking may include managing time off work, such as clocking in late and producing notifications for attendance issues or tracking days off such as paid time off (PTO), sick leave, or vacation time balances. Many systems today have workflow processes enabling the employee to request time off, the manager to approve or deny the request, and then have the request automatically flow to payroll when it is time to make the payment. These features not only allow greater availability to benefits provided by the business, but also tie in well when managing schedules and ensuring proper coverage when employees are not at work.
In addition, if you use a payroll processing vendor, you should speak with them about best practices that should be integrated into your current systems. Many large providers may provide their own platform with prebuilt integrations that can save you time and money building the connections.
The APA offers many resources to help connect you with time tracking vendor options. Click the tab on the homepage of the APA website labeled “News & Resources” and select the “Buyer’s Guides” link that appears under the “Vendor Resources” heading. From there, it will allow you to select the option for “Time and Attendance Systems Buyers Guide.” The guide will provide a list to help you with the process.
To manage all the requirements in time tracking, you must have a system that is flexible. Everchanging compliance regulations are keeping us on the edge of our seat but knowing you can manage it within the system is key to efficiency and best practices.
Barb Muellerleile, CPP, is the Senior Director of Finance and Payroll at Panera Bread. She is also a member of the APA’s Board of Contributing Writers for PAYTECH, a volunteer on the APA’s Certification Board, CHAMPS Committee, Nominating and Elections Committee, and the Retail Best Practices Subcommittee of the Strategic Payroll Leadership Task Force (SPLTF).