Since tracking employee work time is all about the numbers, it’s not surprising that the industry has accumulated a whole bunch of statistics and survey results. Some of them can be interesting, some are instructive, and some can be downright surprising. (And maybe a little bit scary!)
Time & attendance has been around a while
For instance, did you know that the time and attendance industry has been around for over 125 years?
It’s true! Back in 1888 Willard Bundy, a jeweler in Auburn, New York, invented a mechanized time recorder controlled by a clock movement, called the Bundy Key Recorder. It was cumbersome compared to today’s punch clocks, but it was a big advance over writing time down by hand. (Or not tracking time at all!) This is why in some areas punch clocks are still referred to as “Bundy clocks.”
Some people seem to think mechanical punch clocks must have gone the way of the dinosaur by now. In fact, our iconic “green clocks” — the Model 125 and Model 150 — are still among our most popular models. They’re incredibly durable and can often work well in harsh environments that are unsuitable for more sensitive electronics. We know of at least one Model 125 that’s been in continuous use here in a Raleigh area business for over 40 years!
Automation gains in popularity
But a lot has changed in the world of business since 1888. It would be strange to come across an office that doesn’t use at least one computer these days. Businesses are discovering more and more benefits to automating their business processes: increasing efficiency, eliminating clerical errors, saving time and money, and more.
When it comes to their workforce management function, one of the first processes many businesses choose to automate is time and attendance tracking. If you’re using an automated system to track, total and report on employee work time, you’re in good company! According to a 2013 Aberdeen Group study, about 2/3 of the responding organizations reported they automate their time and attendance tracking. When you limit the result to “best of breed” companies, that figure is over 75%!
Integration is the next wave
Once a company has automated their time tracking, the next logical step is often to integrate that employee time data with other applications. Employee time is used in so many contexts: for calculating cost variances, for computing payroll, for billing clients, and so forth. After you’ve collected and stored the data, it only makes sense to use it where it can be helpful.
One of the first integrations that most companies consider is connecting their time and attendance application with their payroll. If you think about it, that’s a natural pairing, as the “hours worked” data from time and attendance need to flow into payroll in order to calculate employee paychecks. Sharing information between those two systems makes total sense.
According to research conducted in 2008 by the Aberdeen Group, over 85% of “best in class” companies integrate their time and attendance system with their payroll system.
Even better, organizations that integrate time and attendance with payroll realize some impressive benefits. They reported significant decreases in overtime costs and increases in revenue per employee — to the tune of a 10% improvement!
Benefits for Employers
Most likely, anyone who’s worked with time tracking or payroll for a while is familiar with the American Payroll Association’s estimate that up to 10 minutes per day per employee is lost due to tardiness, long lunches and early departures. Admittedly, on the surface that doesn’t sound like much, but when you add it up, that’s almost an hour per week per employee. Multiply by how many employees you have and you can see it works out to a hefty amount. This can come as an unpleasant surprise for a lot of business managers.
At some companies they like to think their employees would never do anything like that. But here’s one of those potentially scary statistics: according to a Harris Interactive survey in 2009, 21 percent of hourly employees admitted to stealing company time. Five percent said they’d either buddy punched for someone else, or asked someone to buddy punch for them. Nearly 70 percent said they punch in and out earlier or later than scheduled, 22 percent padded their time sheet by adding additional time, and 14 percent didn’t punch out for unpaid lunches or breaks.
If you think it isn’t happening at your company, you might want to think again. Chances are, it is.
The good news? Simply by monitoring employee arrivals and departures, many companies find they reduce these kinds of incidents.
On top of that, the American Payroll Association also estimates that it takes at least five to six minutes to audit and total a paper time card, and estimates an error rate of anywhere from 1% to 8% when manually adding up time.
That can add up to a lot of time and money wasted on manual computations and going back to fix errors from the last pay period’s manual computations.
By reducing or eliminating time theft, eliminating clerical errors and reducing the overall time it takes to prepare payroll, many companies find an automated time tracking system integrated with their payroll can pay for itself within a matter of months.
Benefits for Employees
Of course, some managers worry electronically monitoring employee time and behavior might lead to morale problems. But according to a study published in 2013 by the Olin Business School at Washington University, when restaurant employee behavior was electronically monitored, both productivity and customer satisfaction increased!
In the study, a restaurant was worried about employee theft, and actually went so far as to install video cameras as well as other systems to monitor employee behavior. Most of the employees didn’t seem to have a problem with it. The dedicated employees tended to work harder because they knew somebody was watching. The problem employees tended to reform or leave as they found out they couldn’t get away with poor behavior any more. The amount of theft went way down, the restaurant found they were selling more food and drink, and the customers were happier with the more attentive service… which led to greater tips for the servers… which motivated them to continue to provide better service… which led to even bigger sales and more tips.
I think the key here was that the employees could see the benefit of the new system (they got bigger tips). As long as employees understand how a new system will help them — by making sure they get credit (and pay) for all the hours they work, ensuring their paychecks are more accurate, making it easier for them to submit time off requests, and so forth — they’re much more likely to embrace it.
In fact, according to a survey published in 2010 by Axsium, after implementing an integrated workforce management solution, over 80% of managers and employees were “satisfied” to “very satisfied” with the results.
OK, editorial comment time: speaking as an employee, I know it drives me crazy when I work hard to do the right thing and see others apparently getting away with taking a long lunch or sneaking out early on Friday afternoon. It’s a real morale-killer. Having a system that makes it harder for the slackers to get away with it is a big plus in my book — and I know I’m not the only one.
The point is, there are benefits to both employers and employees to having a good workforce management system in place. As long as you make sure to communicate with your employees about the benefits they’ll realize from the new system, there’s a good chance they’ll embrace it.
We’re Here To Help
If you’re interested in cutting the time it takes to prepare payroll, while reducing errors, increasing accuracy and offering advanced features to benefit both your organization and your employees — you should be talking to us! We’ve been helping businesses track employee work time more accurately for over 45 years, starting with our durable traditional punch clocks and later expanding to time-saving automated software. Now, through our cloud-based service, Send us an email or give us a call today to find out more about our solutions and how they can help you.