Still Using Spreadsheets to Track Your Labor Hours? Here’s Why it Might be Time to Stop

Twenty years ago, when I started in the in the time and attendance business, manually tracking time and attendance was the norm. The majority of businesses used manual “punch clocks,” where employees would place their time card in a machine on the wall and literally “punch” the top of the clock to stamp their time card with the date, time of their arrival, breaks, lunches and, finally, when they left for the day.

Frequent errors in the placement of the punches, over stamping, hand written notes and “buddy punching” were all too frequent. The payroll department would spend days and, in some cases, weeks calculating each employee’s total work hours. They would then have to apply federal and state rules – as well as any applicable union rules - to calculate gross pay for each employee. This was a lot of work and left a lot of room for human error. Yet, even today, it’s amazing how many companies, both large and small, still employ the manual punch card system in one form or another.

Fast forward a few years and “job tracking” becomes an industry buzzword. With job tracking, employees use their time cards to record the jobs and/or projects they worked on throughout the day. This further cluttered the faithful, coffee stained, tattered and often-dreaded time card. As a result, some of the larger organizations and payroll managers started to embrace technology, many of them adopting the use of such large and bulky computer servers as mainframes or the IBM AS/400 to track and collect employee time and attendance data.

Introducing the spreadsheet, the cutting edge of technology…. or not

Then came the revolutionary spreadsheet. Surprisingly, in today’s technologically advanced business environment, many companies are still using spreadsheets to track employee time, pay, accrual balances and more. Although this “tried and true” method may seem perfectly acceptable, you may be surprised to know that studies show that up to 88 percent of spreadsheets have errors. These types of error rates would be completely unacceptable in most areas of business. However, for some reason, businesses still accept the risk when it comes to payroll.

Managing time and attendance regulations

Unfortunately, in today’s regulated environment, businesses have scant room for errors. Considering the level of complexity in the modern workplace and all the laws employers must comply with, such as the Fair Labor Standards Act (FLSA), the Family and Medical Leave Act (FMLA) and the Affordable Care Act (ACA), to name a few. Then add shift differentials, overtime equalization, averaged overtime, tips compliance and a plethora of other issues small businesses face. Taking all this into consideration, don’t you think it’s “time” to look at an upgrade?

Ditching the time and attendance spreadsheet

Today’s workforce management applications can handle the burden of staying compliant and consistent with your time and attendance management.

If you are a smart employer who is convinced that now is the time to streamline and automate your time-tracking, here are a few features to look for in a workforce management solution:

• Multiple electronic time-entry methods, including hardware, software and mobile options.
• Integrated rules engine with configuration (not customization) capabilities in anticipation of changing state and federal labor laws to come.
• Integrated scheduling, including error-tracking for monitoring of employees who may be consistently arriving late or leaving early, taking long lunches or breaks, gaming the system for overtime, etc.
• Robust reporting capabilities and integrations with HR and payroll.

This communication is for informational purposes only; it is not legal, tax or accounting advice; and is not an offer to sell, buy or procure insurance.

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