March 23, 2021

How Detailed Should Your Employee Time Tracking Be?


Time tracking for today’s workforce is an increasingly complex task. Virtually every organization needs to track employee time. Adding greater levels of detail can help your organization identify opportunities and efficiencies that can drive your bottom line.

What do we mean by different levels of time tracking? Professionals like accountants and consultants bill by the hour. Hospitality businesses such as hotels and restaurants have large numbers of employees who are paid by the hour. School districts and healthcare providers are tasked with creating and managing complex employee schedules and tracking time against those schedules.

Regardless of the industry, with the desire for more productivity and efficiency, time tracking has become one of the most powerful workforce management tools. Solo businesses and small shops may be able to get by tracking time using timecards or spreadsheets, but any company with more than two or three employees requires a centralized tool.

Configurable time-tracking solutions

Having spent more than 30 years working with thousands of organizations across many different industries, we’ve seen and heard just about every time tracking scenario. Based on customer needs, we’ve developed highly configurable solutions to address those scenarios.
We provide three levels of time tracking detail to help you track everything related to employee time: time and attendance, labor tracking and job costing.

Time and attendance

Time and attendance are the foundation, or first level, of time tracking. Organizations use time and attendance to track when employees clock in and out for their shifts and when they take breaks. Most organizations choose to integrate time and attendance data with their payroll system and use the time records to pay employees. Integrating these systems improves efficiency and accuracy.

Typically, a small business with just a few employees can get by with basic time and attendance. Along with integrated time clocks, time and attendance systems help ensure accurate and timely pay and minimizes the manual effort of collect paper timecards and tabulating hours. Adopting a time and attendance system is a good first step for companies that want to empower employees to track their time at work and on breaks, streamline timecard submission, review and approval processes, and reduce the risks of time theft. Using software to manage time and attendance saves time and provides employers with reports that will help assess and address staffing needs.

Labor tracking

Once you have a time and attendance platform in place, labor tracking helps take your data to the next level of detail. In addition to simply tracking when an employee clocks in and out, organizations can use labor tracking to understand what their employees are working on during their shift. This data is helpful because it helps organizations ensure employees are paid accurately for the work they do each day.

Labor tracking is useful for organizations that have workers who hold multiple jobs within the organization. For example, school district employees often wear many hats – working as the crossing guard or library assistant as well as the lunchroom supervisor. Each of these roles may have a different pay rate. With labor tracking, the job these workers select when clocking in for a specific shift can be used to automatically determine the correct pay level.

Labor tracking is also useful for companies that want details about how labor is being used – not just the number of hours worked. For example, automotive workers may complete different types of labor during their shift. In eight hours, they might work on repairs, maintenance or body shop tasks. Even if they get paid the same rate for all three jobs, it’s valuable for the shop owner to use labor tracking to differentiate the specific ways and projects for which that employee’s labor is being used.


Job costing

For an even greater level of detail, organizations use job costing. This allows companies to track more than just time and the type of work employees complete. It also allows employers to track the work down to specific cost codes. Job costing is particularly helpful to organizations that need to track billable employee time to different clients or jobs. Using labor tracking, employers understand what employees are doing, and with job costing, they know which projects they were working on.

For example, we know that most legal and architectural firms run their operations based on billable time. These firms can use job costing to assign cost codes for time spent on a specific client project. Being able to track time and associate it with projects, contracts and invoices ensures that organizations keep their billing accurate and current. For more examples of how to use job costing, check out our eBook “Everything You Need to Know About Workforce Management.”

The data you need to make decisions

As the ways organizations can apply workforce management practices expand, it’s essential to have a system that supports workforce strategies now and for the long term.

It’s no longer just about time and attendance. Labor tracking and job costing are essential ways organizations can gather the data they need to make decisions that support the business.

With these tools, you enable your entire organization to work smarter because you’ve captured and analyzed the information needed to be able to make wise, data-driven decisions when it comes to workforce management.