If you’ve spent any time perusing web sites of time and attendance companies, doubtless you’ve come across the claim that an automated time and attendance system will save you time and money.
As it happens, it is in fact true that within just a few months an automated time and attendance system could save your company more money than you spent on the system. Often quite a lot more.
But if you’ve never used an automated system, you might be wondering exactly how you’ll be able to save all that money. Turns out, there may be more ways than you think.
Let Me Count the Ways
Tighter control over labor costs. Most of us have probably been there. You’re busy cranking out goods, providing services, selling products – keeping the wheels of commerce spinning – and suddenly you realize some of your overtime-eligible people have already put in nearly 40 hours, but you’ve still got a good chunk of the work-week left. Now you find yourself in a scramble to balance your staffing levels to cover the work that needs to be done while minimizing overtime.
An automated system allows you to easily review each employee’s total hours worked at any time. No more waiting until the end of the pay period to add up timesheets or time cards. You’re able to proactively manage labor costs.
More efficient payroll processing. If you’ve still got timekeepers or payroll clerks manually totaling time cards or timesheets, you’ll immediately see a benefit from an automated system. The system will automatically add up each employee’s hours worked and calculate any overtime. In most cases this is accomplished in a matter of seconds (instead of the hours it can take to manually calculate time).
Then, instead of having someone key the totals by hand in to your payroll software or service, the system generates a data export file. Import this to your payroll system, and you’re ready to cut checks – again, in a matter of minutes instead of hours.
You, or your office staff, can then spend your time on more productive pursuits (such as selling products, issuing invoices, collecting bills and the like — you know, revenue-generating stuff!).
More accurate payroll processing. Humans are, well… human. And whenever you rely on humans to add up timesheets and key that time in to the payroll system, errors will inevitably creep in. On the other hand, an automated system won’t accidentally transpose digits, or enter “9” when it meant to enter “6”, or inadvertently leave out one number in a long column of figures.
Think about what happens when an employee notices an error on his or her paycheck — all the time and hassle you or your staff have to go through to fix the problem. An automated system will virtually eliminate clerical errors such as these.
Lower cost of supplies. In order to record someone’s hours worked on a paper-based timecard or timesheet, you have to purchase the timecards, preprinted timesheet forms or at least some blank paper on which to print the timesheet. Then you’ll probably need some kind of ink or toner. (Some time clocks print using heat and thermal-sensitive cards; these special cards are generally more expensive than “plain paper” cards and have the tendency to deteriorate if exposed to heat, making long-term records retention more difficult.)
Using a paper-based system practically guarantees you’ll be spending money over and over again buying consumable supplies such as time cards and ink, toner or replacement ribbons. Over time, the cost of those supplies can really mount up.
With an automated system, you’ll spend far less on supplies. Employees don’t need to start a new paper time card or timesheet each pay period, and the system uses no ink or toner to record their time. If you opt for a badge-based system, badges can be used over and over again, often for years, before they need to be replaced. If you opt for a biometric system, employees identify themselves to the system with a biometric characteristic — such as their fingerprint or the shape of their hand — meaning no paper or badges are required at all.
More compact records storage. Wage and hour laws require you to retain payroll records for anywhere from one to three years, depending on the kind of records. However, to be safe most experts advise retaining these items for anywhere from seven to 10 years.
If you’re using paper time cards or printed timesheets to track hours worked, think about how much storage space you need to maintain physical copies of 10 years’ worth of those time cards for all your employees. Of course, you could eliminate that storage space requirement by scanning those paper time cards or timesheets to digital format — but this could absorb quite a lot of staff time (or a lot of money paid to an outside service).
With an automated system, your records are already in electronic format and can easily be burned to a CD or copied to a thumb drive or portable hard drive each pay period, for easy storage in a secure and protected location.
More efficient records retrieval. We don’t like to contemplate a wage and hour examination, but the fact is, audits happen to the best of us. The federal Department of Labor (DOL) has announced a new emphasis on compliance, and just last year the Wage and Hour Division (WHD) hired 250 additional examiners. In addition, many states are stepping up their compliance efforts. The chances are better than ever you’ll experience an examination yourself sooner or later.
When the examiners ask to see specific records, do you want to have to devote staff time to digging through piles of musty boxes to retrieve what they’ve requested? Would you be comfortable simply turning those boxes over to the examiners to let them go through and pick out what they need on their own? (Yikes!) Or would you rather simply load up a CD on your computer, open a file and print out the requested information? (I know which one I’d pick!)
Whether you’re looking up the information for a wage and hour audit, or retrieving data for an IRS inquiry, or responding to an employee’s question, you’ll get back to productive (revenue-producing) work much more quickly with electronic records.
Risk reduction. Many experts recommend you have all employees record their work time, even those you classify as exempt. That way, if there are any questions about time worked versus time paid, or any employees you considered exempt from overtime regulations are later reclassified as non-exempt, you’ll have complete time records for them all. Most courts will rely on those records to calculate the employees’ overtime worked.
Without your time data, the courts and examiners will simply use the employees’ own recollections and personal records. The problem with this, of course (human nature being what it is): people tend to remember those times they worked late, and forget the times they left early or took a long lunch.
Would you rather pay overtime based on accurate and official time records, or based on employees’ memories and calendar notes? (Again, I know which one I’d pick!) An automated time and attendance system makes it easy and convenient for all employees — including salaried exempt employees — to track their time. Those time records could some day save your company thousands of dollars.
But What Will the Employees Think?
Some employers may fear their “white collar” workers will resent being asked to clock in and out. And in fact you may hear some grumbling, at least at first. However, we’ve found if you explain up front the benefits of reduced costs and increased accuracy, most employees understand why an automated system is a good idea. And if they’re able to clock in and out discreetly, quickly and without a lot of hassle, it soon simply becomes a normal part of the work day.
Modern software-based or web-based time and attendance solutions are very different from the traditional time card and punch clock. With many automated systems, clocking in and out may involve nothing more than waving a badge across the front of a terminal, or placing a fingertip briefly on a scanner. Employees may even be able to clock in and out using the PC on their desk — or for remote workers, over the web or using a cell phone.
If you’d like to find out how much your business could potentially save with an automated system, check out Acroprint’s Savings Calculator. You may be pleasantly surprised! And when you’re ready to start saving money on your time and attendance tracking, take a look at timeQplus, a Pendulum system or AcroTime web-based time and attendance for easy, quick and reliable automated workforce management.