Why Do We Need Timecards?

“Timecards are a pain because my employees either don’t complete them correctly or don’t turn them in on time. My employees never work overtime and I’m willing to pay them their regular 40 hours each week even if they take off a little early. Why can’t I just stop using them?”

My HR Survival Tip

Yes, they can be a pain but if you allow employees to think they aren’t important, you are giving them permission to complain and not take them seriously. There are 3 basic reasons for timecards:

1. They let you know how much your employees are working. This information is used to ensure you are paying them correctly and can also be used to let you know when it might be time to hire more people or how efficient your employees are. For example, 2 employees each work 40 hours and one produces 100 widgets and the other produces 60 widgets… what does that tell you? Learn to use the metrics available to you!
2. They protect your company by providing backup you may need to prove your employees were paid for all hours worked, any overtime worked, and that your employees took meal and rest breaks in accordance with CA law. Without a timecard as proof, the state will take the employee’s word about whether or not they were paid for all overtime worked, whether or not they skipped a meal period or took it late, etc…. over the past 4 years! Once the state has heard from the employee, you get to write a check.
3. They can be used for job costing so you know how much a particular project truly costs you in labor. In this situation, both exempt and non-exempt employees track their time based on projects. Now, instead of  having just a guesstimate of how much labor costs were, you have a number you can use to create better quotes in the future and to predict your profitability from project to project.

If you’re spending a lot of time calculating the hours, look into web-based systems, timeclocks, or just an Excel spreadsheet to save you time by doing the math for you. Make sure your employees know you are serious about reporting time worked and time off. Develop a penalty for late or incomplete timecards, such as a temporary reduction in pay, unpaid suspension, a black mark on their review, or write-ups.

Bottom line, get over it… timekeeping is part of owning a business. However, if you’re having trouble recognizing and appreciating the value of timecards for your company, I’ll bet EDD could convince you fairly quickly!