Every employer is subject to minimum wage laws. Compliance can be complicated, but employee timekeeping doesn’t have to be. An employee timekeeping system simplifies minimum wage compliance. Plus all the other laws. These include overtime, Affordable Care Act, child labor, fair scheduling, and meals/breaks.
What Is An Employee Timekeeping System?
An employee timekeeping system is a type of business software. It keeps an accurate record of employee work hours. This includes punch times, total hours, overtime, and breaks. It performs all the necessary calculations to run payroll. It imports the employee hours into the payroll system.
An employee timekeeping system may sync with a physical time clock. Employees punch in with the clock. The clock sends the information to the software. Some systems use only a web login. Most systems will work with a variety of time clocks—PIN entry, proximity card, or biometric. The software creates time cards. It calculates vacation accruals. It tracks employee status.
What Information Am I Supposed To Track?
Compliance is only possible with accurate tracking. And there is a lot to track.
Here are the basics:
- Employee profile (name, age, address, etc.)
- Job position (job title or tasks performed)
- Employment status (exempt, non-exempt, temporary, etc.)
- Type of employee (employee, independent contractor, seasonal, union)
- Employee work hours (per shift, day, and week)
- Amount of overtime worked
- Breaks and meals (paid and unpaid)
- Daily and weekly employee schedules
- Vacation/leave accruals
- Wages paid
- Payroll withholdings
- Tips earned
This is not an exhaustive list. There are state laws, industry provisions, and union contracts. You might need to track additional information for these.
Why Do Manual Processes Put Me At Risk?
It’s possible to use spreadsheets and paper forms for tracking. Many people do it. But it’s easy to make a mistake. Especially when you are doing several things at once. Business owners are impressive multitaskers. But eventually you max out your capacity. You accidentally delete a cell in a spreadsheet. You make an addition error. And there are other people involved. These people don’t have as much at stake. An employee forgets to punch in. A manager loses a time card.
Each of these simple mistakes can contribute to a violation. In the past two years, penalties have tripled in cost.
If your time and attendance system does not collect accurate records, compliance is futile. Accurate records are the foundation of compliance.
An employee timekeeping system makes compliance a whole lot easier.
By Liz Strikwerda