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The Complete Guide to Employee Time Tracking In 2021 [by an Employee Time & Labor Expert]

By Timerack

July 14, 2021

It goes without saying that time is any business’ most valuable resource. For this reason, and many others, it’s extremely important that businesses are able to keep track of how their employees are managing it.  

Furthermore, when the pandemic threw our work lives completely off balance, employee time and attendance tracking became an essential component for workforces.

Even as we attempt a return to some sort of normality, new, innovative ways to keep track of employee hours remain important, as most businesses are unlikely to fully return to the workplace. Instead, they’re opting for flexible, hybrid work models.

For this reason, we’re going to talk you through some of the best employee time tracking methods, tell you why they’re important, and explain how your business can benefit from them. 

What is Time and Attendance Tracking?

First up, let’s backtrack a bit and make sure all our readers are familiar with the concept of time and attendance tracking. 

In short, time and attendance tracking is logging when employees begin and end their working days, as well as keeping tabs on when they take any breaks. 

It’s also a way for management to log in when their workers are absent due to sick days, compassionate leave, or paid vacation time. 

Here at Timerack, however, our innovative time and attendance systems go beyond just tracking the obvious. We also offer ways to measure productivity, as well as sync time and attendance tracking to payroll software and HR services. 

Why Track Employee Time and Attendance? 

As we mentioned in our introduction, there are many reasons why tracking employee time and attendance is important. 

The first and most important reason is to ensure that employees are being properly compensated for the amount of work they’re doing. Without time and attendance tracking, in many jobs, it would be difficult to calculate exact salaries at the end of each month. 

Moreover, another important reason for tracking employee time and attendance is because, at the end of the day, time is money. And if it’s not being spent efficiently, then money will be being wasted, which is never a good business strategy. 

Thanks to time and attendance tracking data, employers can ultimately make future business decisions such as working out the right moment to expand their team.

How to Keep Track of Employees’ Time

Found yourself Googling “how can I keep track of employee hours?” Well, there are myriad different employee time-keeping methods that employers can use to monitor workers’ time and attendance activity at work. 

In the past, many businesses used manual solutions, such as time clocks or paper timesheets. Workers would fill these in by hand in order to track employee working hours on a daily basis. However, these methods lend themselves to all manner of problems, which we’ll go into later. 

This is why it’s a good idea to automate your business’ time and attendance tracking solutions. This brings us to our next point…

Optimizing Time and Attendance Tracking 

One of the easiest ways employers can improve their time and attendance tracking methods is to digitize them. 

Here at Timerack, we specialize in innovative, digital, all-in-one time tracking solutions for small to medium-sized businesses. This is the best way to track employee hours.

Our solutions include an easy-to-use management suite of time and labor software, which includes features such as dashboard reporting, a web punch clock, and a cloud-based data storage system. 

We also offer data collection hardware, which comprises biometric time clocks and a contactless punch-in system, complete with color LCD displays. 

The final automated time tracking solution we offer is a time attendance mobile app, which uses geo-fencing and GPS location tracking to monitor employee time and attendance while they are out in the field. 

Benefits of Employee Time Tracking

Innovative, digital time and attendance tracking solutions can bring a whole host of benefits to your business, regardless of the industry you operate in. Let’s explore them in more detail.

1. Eliminates Human Error 

One of the downsides of manual time and attendance tracking is that processing all that data — whether it’s on a paper or Excel spreadsheet — carries a huge potential for human error. 

One small slip-up could mean your employees don’t get paid on time, or worse still, they might be underpaid. In order to avoid disappointment and keep employees happy, it’s best to invest in a technology that guarantees accuracy. 

2. Alleviates Stress 

We’ve said it before and we’ll say it again, there’s nothing worse than a mad end-of-month scramble to pay employees on time! Processing thousands of timesheets all in the same week is a recipe for disaster for your HR department. 

If there’s anything this pandemic has taught us, it’s the importance of work-life harmony. With automated time and attendance technology, you can take the pressure off your HR employees, and this is worth its weight in gold.

3. Increases Productivity

Speaking of looking after your HR department, letting technology do a large portion of their work for them means they can dedicate their time to focusing on more sophisticated and complex tasks. 

This should hopefully serve as a way to motivate their employees, increase their productivity, and help them set goals to progress within the company.

4. Monitors Productivity

Given that many automated time tracking solutions offer real-time dashboard reporting, managers can access the breakdown of how employees are spending their time.

These kinds of workforce insights can help make task delegation and time management easier for both workers and management. 

5. Complies With Regulations

Believe it or not, there are actually several federal laws that employers must comply with when tracking employee time and attendance. 

Under the Fair Labor Standards Act (FLSA), meal breaks that last for 30 minutes or longer are not classed as “work time” and therefore do not have to be paid. 

For any employees who choose to skip this break and continue working through lunch at their desk, time and attendance technology provides a formal record to clock that time, for which they must be legally paid. 

Given that failing to track breaks or rest periods is an FLSA violation, time and attendance technology helps businesses to stay compliant with these regulations in order to avoid fines.

6. Prevents Time Theft

Statistics show that employees steal an average of 4.5 hours a week from their employers, which can add up to a severe financial loss for any company. 

However, by using time and attendance tracking solutions such as biometric hardware — which requires proof of the employee’s face to register their data, or geofencing technology, which automatically tracks via a mobile device — companies can prevent time theft.

7. Eliminates Buddy Punching 

Buddy punching — which is when one employee asks another to clock into work on their behalf — is another form of time theft that can cause businesses to lose more than two percent of their annual gross payroll. 

This practice used to be common with manual time clocks, but there’s no getting away with it with GPS time tracking software that automatically tracks employees for you.

8. Improves Security

It’s also worth mentioning that automated time and attendance solutions have features that make them more secure than other digital technologies. 

With biometric technology, no passwords are required, which reduces possible cybersecurity risks associated with time and attendance tracking.

9. Integration With Payroll/HR Services 

Last but not least, one of the main benefits of automated time and attendance tracking solutions is that if they’re made by Timerack, we can synchronize them with many different iterations of payroll software, as well as our integrated suite of HR services

This means your company can manage numerous different aspects of time and attendance tracking through one simple, easy-to-use platform instead of operating (and paying for) multiple different ones. 

Disadvantages of Automated Employee Time Tracking

Despite the benefits of time tracking automated solutions bring to your company, they also come with their downsides, which it would be unfair not to mention. 

1. Surveillance 

During the shift to remote working over the pandemic lockdowns, one of workers’ main grievances was an uncomfortable feeling of being watched while managers increased the ways in which they monitored them. 

In some cases, digital monitoring software such as facial recognition technology was reported to have a negative impact on employees’ mental health, leading to an increase in anxiety and stress levels.

It is therefore very important that employers strike a balance with their use of this technology, which if upset could prove to be counterproductive in terms of employee productivity. 

2. Security

While in many cases, digital time and attendance tracking technology are considered to be more secure than manual processes, its level of security represents a fine line that employers must tread carefully. 

Gathering large amounts of personal information can cause problems if the data is not stored securely, so businesses must put measures in place to ensure it is protected. 

3. Privacy

Finally, data collection via time and attendance tracking also comes with a warning to protect employee privacy.

This means that companies must communicate clearly with their employees about exactly what data they will be collecting and when, as well as explaining exactly what the purpose of the data collection is. 

This information should be drawn up in a privacy policy and then communicated with employees to create a sense of transparency and trust throughout the company. 

Closing Thoughts 

If you’ve made it to the bottom of this guide to employee time tracking, thank you for reading! We hope you’ve gathered some useful takeaways that you can apply to your business. 

In sum, tracking your workers’ time and attendance is an essential component of any business plan, for many reasons we explained above. 

What’s most important, however, is the way you go about it. Inefficient time and attendance tracking can lead to financial loss, which is the opposite of why we do it! 

So if you’re looking to introduce time and attendance tracking solutions into your company, make sure you choose automated solutions that benefit both you and your employees, in order to guarantee maximum return on investment. 



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