Did you feel panicked when you heard about the new Department of Labor (DOL) overtime (OT) rules? You’re certainly not the only one.
There’s a solution to your dilemma, and it can work for any employer: Time clock software.
The problem many employers are facing is that they currently have salaried exempt employees who make less than the new DOL threshold of $47,476. Those employees will no longer be exempt. This means overtime must be paid time and a half for every hour over 40 per week. In many jobs unpaid overtime for salaried workers has been a given, but that will no longer be the case.
In other words, by the December deadline employers will have to start tracking hours for many more employees, and that’s where time clock software comes in handy.
Whether you need employees to physically punch in or if it would best suit them to clock in online through their computers, this software helps automate the complexities of payroll so that employee hours are carefully and accurately tracked.
5 Benefits to Time Clock Software
Time clock software streamlines payroll processes. Employees accurately record hours as they work and calculations are automated for payday. Here are the five ways it can make a lasting positive effect on your workplace:
1. Eliminates manual time tracking through paper
Organizations that still rely on paper-based time tracking are stuck in the past. Not only does switching away from this method save on paper, but it also dramatically saves on the time it takes for manual data entry. Payroll staff spends a significant amount of time entering payroll data when this process could be automated. No more lost time sheets, and no more forgetting to hand them in before leaving at the end of the day. Every hour is tracked in real time and that information is saved securely.
2. Makes payroll much easier
Organizations often have payroll software for calculating and tracking pay, but manual data entry is the most taxing part of Payroll’s job. Freeing up this valuable time can make your payroll department more efficient. Pay cycles can also be automated so staff spends less time getting ready for each new cycle by using standardized processes. Payroll headaches will dwindle, and you’ll notice a much more relaxed and confident staff.
3. Increases accuracy through more automation
Not only is payroll easier, but it’s also more accurate when human error is taken out of the equation. With time clock software, you can rest easy knowing that each pay cycle has a narrow chance of mistakes. These solutions also account for compliance tracking so all tax rules are applied to each check. Each time clock solution is geographically calibrated so that no matter what state, region or country you’re in, compliance is covered. If your business crosses state lines and some employees must adhere to different tax laws than others, the software takes care of payroll for each location at once.
4. Schedules shifts more efficiently
For employers who must constantly schedule employee shifts week after week, these schedules can be automated as well with time clock software. As time passes, you can monitor when labor runs over or under, and better manage when to schedule more or fewer employees. Staff can even request off through the solution so that as managers schedule workers they’re also able to approve time-off requests. Aside from overtime, the solution can factor in sick time, vacation time, family leave time and many other categories of special pay, including custom categories.
5. Eliminates time theft through biometric clocks and secure technology
One of the biggest downsides to having employees manually clock-in is they can clock-in for each other. Time theft is a very common occurrence and time clock solutions have developed features to prevent it from happening. Biometric options for physical time clocks can scan thumbs, hands, eyes and even faces to verify a person’s identity. Passwords and passcodes are also a common option. When online, the solution can be set to take a head shot through the webcam. Some time-keeping solutions can even track employee work by taking periodic screenshots, a feature more common when employing remote contract workers such as coders and freelancers.
While the benefits of time clock solutions are clear, there are some important considerations before investing in new time-tracking software and hardware.
- Cost – Know the upfront costs of bringing the hardware into your company as well as the ongoing expenses for subscription or licensing fees for the software. Both the physical time clock and the software solution will likely be priced separately. Services and support add extra costs, but this depends on the service contract.
- Time Frame – Implementing time clock software takes time. From purchasing the solution to onboarding employees, there’s a process for installation and configuration for the software to work with all present systems. This may require data migration to upload employee information from a prior system and is a process that differs between every business.
- Training – Your employees and payroll staff must understand how to use the new time clock software. If employees are still stuck in their old ways, you must communicate the importance of using the new system correctly so that they understand the benefits on their end as well. Payroll staff will end up saving themselves time and headaches with more efficient practices. For employees new to clocking in, they’re being properly paid for their time which is the purpose of the DOL’s rule change. HR Morning has discussed some of the conversations employers must have with their employees in light of these changes.
The Bottom Line
Employers have until December before the DOL rule goes into effect, just enough time to search for and identify the right time clock software. Now is the perfect opportunity for any employer still using paper-based payroll to make the switch to a more efficient system.
In the long run, this software will help protect employers from legal trouble and boost their compliance with federal payroll regulations.