Time And Attendance For New Business Owners: 3 Easy Steps
Starting a business with hourly employees? Don’t neglect the importance of automated employee time and attendance. If you don’t tame the beast, employee timekeeping and scheduling will eat you alive.
Solve time and attendance problems first with automated workforce management. It’s a foundational business process you need out of the way before you can focus on building success.
Let’s cover the basics, first…
How To Set Up Employee Time and Attendance For a New Business:
- Step 1. Choose time and attendance software designed for your business.
- Step 2. Choose an employee time clock that fits your needs.
- Step 3. Create an implementation plan (and follow it!).
Those are the basics of starting your automated time and attendance system.
At this point, you have some questions. Let’s look at some answers…
What Is An Employee Time and Attendance System?
An automated timekeeping system is a software application linked to an employee time clock. When employees punch in and out with the time clock, the data is sent to the time and attendance software.
A time clock may be a physical device, an online portal, or a mobile phone-based app. In either case, employees use the device to record time and attendance data. An automated software system records the data for use in payroll.
The software uses the data to:
- Calculate hours worked
- Create digital time cards
- Export time records to payroll
- Store archive records
Employee Timekeeping + Scheduling = Workforce Management
Some employee time and attendance systems include scheduling features. Integrated time and scheduling is workforce management.
Advanced workforce management systems do the following:
- Allow employees to punch in from telephone, computer, or internet-enabled device
- Track employee time to the minute
- Calculate paid time off (PTO) including vacation and sick days
- Verify location of punch in/out with Global Positioning Satellites (GPS)
- Prevent unauthorized punches with schedule enforcement
- Omit punch errors with employee status prompts
- Enable managers to easily make complicated employee schedules
- Allow scheduling by job codes
- Alert managers when an employee is nearing overtime
- Automate labor law compliance including Fair Labor Standards Act, Affordable Care Act, Fair Workweek Laws, Sick Leave, and state or local ordinances
- Provide employees with self-service time card management
- Have an online trade board for employees to handle their own shift trades
- Share HR tasks with employees
- Accommodate employee schedule preferences
- Show managers who is working when and where
- Prevent “buddy clocking” (a form of wage theft where an employee clocks in for a co-worker who is not at work)
- Compile detailed timekeeping and schedule data
- Prevent payroll errors
Manage Your Biggest Expense
Labor will be your largest budget item. Time and attendance software will keep it as low as possible. But that’s only one of the reasons it’s critical for start-ups. Here are just a few of the benefits for a new business:
- Maximizes productivity
- Prevents overpaying for labor
- Ensures accurate payroll
- Protects against time theft
- Streamlines payroll
- Improves employee communication
- Makes creating and managing schedules fast and easy
- Simplifies compliance and reporting
- Helps employees focus on their work, not admin
Time and Attendance For a New Business
1. Choose Your Time And Attendance Software
Do lots of research—it will pay off in spades. Look for time and attendance software designed especially for your type of business. Industry-specific templates save tons of time. Get input from all departments.
The software must be easy to use. Bells and whistles are pointless if nobody uses them. Watch for new features that can help you do things you didn’t know you needed.
Here are some questions you will need to answer when evaluating systems:
- Implementation: how long it will take to set up?
- How long does it take to learn the system?
- Does my time tracking software provider offer tech support? What type? Does it cost extra?
- How will I pay for my time and attendance software? One time fee, yearly, or per employee?
- Will it scale with me?
- Do I want cloud-based or on-premise?
On-premise systems are housed on your company’s servers. Cloud-based systems are hosted on your time and attendance vendor’s servers. There are a lot of advantages to cloud-based systems for new business.
Many of the questions above are answered with cloud-based systems; you would do well to start in the cloud.
Each industry has specific needs. That’s not to say that industries don’t share similar problems. Regulations, workflow, location, and specialty are all important considerations.
Following is a list of unique considerations for each of a handful of industries. Scan through to find your specific niche, and review the items listed as a starting point.
Take a look at some of the complimentary industries, too. You may find you’ve forgotten something to consider for your automated system.
Here are some industry tools to look for:
Food and Beverage
Service-based businesses rely heavily on scheduling. Shorthanded shifts diminish customer experience. With low margins, overstaffing can be a crippling expense.
Tipped workers compete for lucrative weekend dinner shifts. But if you don’t schedule equitably—you’ll have angry servers.
- Restaurant job codes simplifies scheduling
- Self-service shift trading prevents coverage gaps
- Minimize payroll errors
- Employee-aware prompts reduce punch errors
- Pinpoint attendance trends before they cause problems
This industry is characterized by long shifts that often span two calendar days. A time and attendance system needs to be able to handle numerous job codes for the various certifications.
Payroll Based Journal (PBJ) requires precise reporting for staff-patient ratios and work hours.
- Balance departmental staffing
- Payroll Based Journal tracking
- Mobile app with GPS for offsite workers
- Prevent nurse burnout with custom scheduling rules
- Sick leave tracking
- Shift differentials
Hotel staffs have a high degree of pay variation. Many employees have little supervision which creates time theft vulnerability.
Consider ease-of-use if you have workers with limited English ability.
- Hotel pay rate codes
- Filtering functions for department-specific scheduling
- Check schedule conflicts at a glance
- Adjust schedules in real time
- Schedule enforcement prevents abuses
- Manage multiple locations from the same system
Adjust schedules to production variations and machine downtime. 24/7 schedule access important for large work crews. Allowing employees some control over their schedules can help employers attract qualified employees.
Adequate shift coverage is critical for production lines. If you have large work crews clocking in at the same time, consider proximity time clock. Ditto for dusty workplaces.
- Match schedules to production workloads
- Schedule trade board for simplified shift trading
- System warnings prevent unplanned overtime
- PTO tracking
- One manager can schedule for large workforce
- Affordable Care Act compliance tools
You don’t want your customers to leave a store empty-handed because your sales associate says, “I don’t know. It’s my first day.” Minimizing employee turnover is vital as inexperience leads to poor customer service.
Retail environments also suffer wild seasonal swings. Staffing for holiday and end-of-year sales adds pressure to scheduling tasks. New employees and additional staff create opportunities for employee time theft.
The trend toward longer business hours also brings scheduling and compliance challenges.
- Quickly cover a shift when someone calls in sick
- Schedule enforcement prevents overpaying for labor
- Predictive scheduling law compliance tools
- 24/7 manager oversight
- Employees can clock from any computer, tablet, or smartphone
Helping employees achieve a work/life balance is key to attracting the best talent in a competitive labor market. Tight education budgets nationwide continue to pressure districts to optimize workforce management.
Millennials—who are replacing retiring teachers—run their lives with smartphone apps.
- Track employee types—full-time, year-round, seasonal, part-time
- Handle custom pay rules
- Comply with union contracts
- Education-specific vacation policies
- Coordinate with grant-tracking and work-study
Tight margins require strategic workforce management. Scheduling by trade certifications prevents mixups. Mobile clock in/out is not a luxury but a must-have.
Transfer HR tasks to workers with employee self-service.
- Employee time card management
- Mobile app for offsite crews
- Create schedules for numerous job sites
- Track license expiration
- One manager can schedule for large crew
2. Choose Your Employee Time Clock
Employees clock in through web browser on a computer or tablet. They access the employer’s clock-in web page and enter a unique passcode. When researching web-based clocks, verify security protocols.
- Affordable and convenient
- No hardware required
- Gives employees the ability to clock in from any location
- Employee self-service
Mobile employee time and attendance systems are applications that run on a smartphone or other internet-connected device. Some have built-in GPS that tracks the exact location of employee clock in/out.
Employees may use their own phone or company-provided device to access the app. Most time and attendance systems have a companion mobile app, but some don’t have all of the features of the complete system.
- Ideal for mobile or off-site workers
- Employees must have an internet-enabled device
Proximity (card or fob)
Each employee has a card or fob. The clock is a hardware device that registers the card or fob as the employee gets within range of the machine.
Some employers use the proximity card as an identification badge.
- Eliminate shift start and end bottlenecks
- Ideal for dusty/dirty workplaces
- Usually requires less maintenance than card swipe
A card swipe time clock is similar to a credit card reader used by retailers.
Employees swipe a card with a magnetic stripe which registers clock in/out time.
- Easy to use
A hardware device with a keypad. Employees are assigned a Personal Identification Number (PIN).
When clocking in or out, the employee enters their unique PIN.
- No fobs or cards to keep track of
- Affordable for small businesses
This device requires a physical attribute such as a fingerprint, palm, or iris.
Biometric clocks are the most technologically-advanced time and the price tag reflects this. They offer considerable advantages, though.
- Ideal for workplaces that need high-level security
- Elimination of time theft may offset higher initial cost
- State and local laws may restrict what type of biological identifiers an employer can require
- Doesn’t have mobile capability, but timekeeping software can capture punches from both a biometric clock and a web-based or mobile clock
The time clock you choose will depend on your budget and needs. You can learn more about employee time clocks here:
3. Make An Implementation Plan And Follow It
Know The Laws
Know the workplace laws you need to comply with. Following are some of the laws that relate to employee time and attendance and scheduling.
You may have additional local or state labor regulations. When a Federal and State law conflict, Federal generally supersedes. When a State law is stricter, employers should follow the higher standard.
This is not a complete list.
- The Fair Labor Standards Act (FLSA)—regulates minimum wage, overtime, recordkeeping, child labor.
- The Affordable Care Act (ACA)—applies to employers with 50 or more full-time equivalent employees.
- Predictive Scheduling/Fair Workweek—these are being enacted on state and local levels.
- Family and Medical Leave (FMLA)—some states and cities are passing regulations stricter than Federal.
- Payroll Based Journal (PBJ)—applies to long-term care facilities.
The WorkforceHub blog has hundreds of articles on workplace laws. Enter your location in the search bar for articles specific to your state or city. We explain new laws and changes to existing laws, so check back often.
Establish Company Time and Attendance Policies
Setting rules now will prevent problems down the line. You would be surprised at how many entrepreneurs fail to do this. Three years down the road, they find out that nobody was clocking out for unpaid meals. That’s thousands of dollars down the drain. (Hopefully, you are still in business.)
These policies should answer the following employee questions:
- Where do I see my schedule?
- When will my schedule be available?
- What if I get to work a few minutes early—can I clock in if I can start working right away?
- Can I clock out later than my authorized shift time?
- Am I supposed to clock out for breaks and meals?
- Is there any flexibility in my schedule?
- Can I pick up extra shifts if they are available?
- What if I need to trade a shift?
- How do I check my vacation time balance?
Customize Your System
You will set rules based on your workforce characteristics. This includes your policies and labor law requirements. Create policies and procedures even if your business only has two or three employees to start with. Envision your company with 50 or 500 employees as you write policies.
Your time and attendance software vendor should help you set up your system so you can realize the maximum benefit. Take your time. Learn how to use all the functions even if you don’t think you will need them. Seek advice specific to your industry.
Appoint an Implementation Manager
Assign a competent manager to handle the system training. If your company is small, you will probably be doing the training. Your time and attendance software should come with clear instructions. Use these as a training guide.
Conduct Comprehensive Employee and Manager Training
Your team may be very comfortable with technology—but don’t assume they will catch on immediately. Train for the least tech-savvy employee.
Make sure you test after training. Document how well your training worked. Solicit feedback from all parties. Adjust your process for your next round of training.
Simple, Powerful, Affordable Workforce Management
SwipeClock Workforce Management systems are designed for the busy business or nonprofit owner. We specialize in small to medium organizations with hourly workers. 29,000 employers appreciate their perfect balance of simplicity and capability.
By Liz Strikwerda
Simplify HR management today.
Since a small business HR system has a lot of moving parts, you need an organized process to make an informed choice. An HRIS evaluation template can help. But first, let’s start with the basics of HRIS systems What is an HRIS? A Human Resources Information System (HRIS) is a type of business software. It…Read More
Here are 5 practical tips for managing hybrid teams (onsite and remote work). Being intentional about adapting for a distributed team will prevent lapses in productivity and engagement. Build a capable hybrid workforce that can drive your business forward post-pandemic. Practical Tip #1 Focus on outcomes for remote work It’s natural to worry that remote…Read More