Reasons Why Time Tracking Is Essential for Any Size Business

Whether a company has five employees or 500, time tracking becomes a real headache when the wrong system is in place. Employees want confidence that their hours are accurately accounted for, and employers want confidence that everyone’s being honest about the time they spend working. Both sides want a time tracking system that’s reliable and easy to use. Here’s why time tracking matters for a business of any size, and how to choose the right system for yours. We’ll start by defining time tracking itself.

What Is Time Tracking?

Time tracking is how companies keep record of employees’ time, including clocking in and out, paid time off, and whether other time is used. There are several common systems businesses use for this:

Punch clocks, pencil and paper, time tracking software, ID scanning, and spreadsheets.

How Time Tracking Helps

Time tracking produces real effects across the business, well beyond simply logging hours.

Improve Efficiency

When time is recorded easily and accurately, efficiency improves. Using outdated tracking methods, or no method at all, leads to inaccurate paychecks and employees whose work goes unaccounted for.

Morale Increases

Time tracking helps employees feel like their employer actually cares about their time. They know their hours are accurately recorded and their effort isn’t going unnoticed, especially when employers make clear that their own time is tracked too.

Increase Production

When employees see time tracking working in their favor, their productivity tends to increase. They aren’t stuck waiting in line to punch in or relying on a coworker to vouch for them.

Builds Client Trust

For businesses that price work based on time spent, time tracking lets you show customers exactly how a price was calculated and how many hours went into a project. That’s a more professional, defensible approach than estimating cost from memory. It also gives you, as the employer, a clear picture of what a project actually costs in terms of time.

Transparency and Accountability

Time tracking should apply to every employee equally. Applying it across the board avoids resentment and builds real transparency and accountability. It also protects everyone if a pay dispute ever comes up: an accurate time record settles questions about hours worked, protecting both sides from relying on memory alone.

Keeps You Legally Compliant

Beyond the day-to-day benefits, accurate timekeeping is a legal requirement. Employers are required to keep accurate records of hours worked for non-exempt employees under the Fair Labor Standards Act, according to the U.S. Department of Labor. A time tracking system gives you a reliable, defensible record if that documentation is ever needed.

Choosing the Right Time-Tracking System

Once you’ve decided to implement a time tracking system, or improve the one you have, the next step is choosing the right one. Here’s a closer look at each method mentioned earlier.

Punch Clocks

An old but familiar method: a card is inserted each day to record clock-in and clock-out times. The main downside is the time employees lose standing in line to punch their cards, especially with a larger team.

Pen and Paper

Time is recorded by hand each day and handed off to payroll when needed. This method depends entirely on trust and honesty, and leaves plenty of room for simple errors.

Spreadsheets

Employees log time in a spreadsheet that’s forwarded to payroll or management. It’s a step up from paper, but still prone to simple entry mistakes.

Scanning IDs

Employees scan an ID badge that a machine recognizes and logs. The catch is that employees need to remember to bring the badge to work, since they can’t clock in without it.

Time-Tracking Software

The most efficient option overall. Time tracking software works on desktops, tablets, and smartphones, letting employees record time from wherever they’re working, including remote employees using the same system as everyone else. Because it’s software, time is tracked with a high degree of accuracy, and employees can set reminders or alarms to help them remember to clock in.

Introducing Time Tracking to Your Employees

Whenever something new gets introduced at work, employees deserve to know why, and how it benefits them. Time tracking can sound like a negative if someone’s never used it before, so it helps to be direct about what it is and what it isn’t.

The biggest fear is that it’s spyware. If “time tracking” is new to someone, it can sound like their employer wants to track their every move, down to bathroom breaks or personal calls. Make clear that isn’t the purpose, and that management’s time is tracked the same way.

The second concern is that it’s just busywork. Employees already have plenty to do, and another task can feel like a burden. Frame the new system for what it actually is: a way to cut down on wasted time, not add to it.

It’s reasonable for employees to question a new system at first. With a proper introduction and real training, most come around quickly once they see how it works in practice.

Take the time to choose the right time tracking system for your business, whatever its size. At TimeTrakGO, we offer web-based time clock software that makes adopting or upgrading your time tracking straightforward, plus PTO tracking software to help employees keep track of their time away. Contact TimeTrakGO or sign up on our website to get started.