Top 20 Employee Time Tracking Best Practices

Most employers know why they need to track time (to make money and to pay people!)... but do you know how to make the most out of time tracking? Do you know how to get your employee base to follow your policies?

If time tracking feels more like a necessary evil to you than a business asset, read on and let our top 20 time tracking best practices guide you to time tracking nirvana!

Best Practice #1: Lead by Example

Time tracking should be from the top down, especially if you are in an environment that is client-billable like a law firm or consulting firm. Employees will want to see their managers and leaders obliging by the same best practices and policies that they are instructed to do. It also can help with our next point- training employees- as if your leaders and manager are tracking time too, that will make them better trainers!

Best Practice #2: Train, Train, and then Train Employees Again

An executive coach once told me that, as business owner or CEO, when you think you’ve told your team something, tell them 3 more times and then it will be heard. Time tracking is no different. Train employees to the point that they can do it in their sleep, especially to avoid losing a good amount of money. Make sure they understand the software or system you are using, and train them in various ways (i.e. demonstration, videos, guides, and having them practice fake time sheets are 4 ways to train).

Want ideas for how to train employees? Check out our next blog post coming soon!

Best Practice #3: Make it as Automated as Possible

Our phones can log the quality of our sleep. Our refrigerators can update to optimal temperatures. More and more, we expect for tasks that bog us down or distract us from what’s important be as automated and hands-free as possible. Same goes for employee time tracking. Consider how much more time your team could have available for priority items and eliminate as much as you can in their way, such as having pre-programmed time sheets or allowing them to duplicate time logged if their days tends to be very similar.

Best Practice #4: Be Decisive on Hourly vs Salaried Time Tracking

Change is constant and a fact of life, but why not minimize the change you have to manage? Managers can establish trust by keeping things as consistent as possible for their teams and should have a firm line on who and what positions track time and why. For example, if you are a law firm, your salaried and hourly people will log time because its how clients are billed and how they are measured for performance. If you are a restaurant, you might not have your salaried workers log time since they are usually out on the floor of the restaurant doing 8 things at once. Either way, come up with a policy for both hourly and salaried employees and the time tracking expectations around them.

Best Practice #5: Record Time Daily (Don’t Wait for Friday!)

Do you remember what you had for lunch on Monday (today is Thursday as I write this)? I sure don’t. If you can’t remember something like that, how can you or your employees remember what time they clocked in or out, or what hours should be timed for which customer, for an entire week? A best practice is to keep it simple and classic: clock in when you settle into your desk for the day (as in, AFTER the coffee & bathroom run that takes 10 minutes) and clock out/ finishing your time tracking before you leave for the day. Do it every day.

Best Practice #6: Make the Categories Simple

Time tracking isn’t resume building - no need for fluff. Save your team time and confusion by keeping things as straightforward as possible. Try categories like “Editing,” “Meetings,” and “Employee Trainings.” Keep it clear and consistent across projects, and make sure you keep the lines of communication open if a project is missing something; empower employees to ask if they feel another category is needed (versus them not tracking that time and you losing revenue!).

Best Practice #7: Have Everyone on the Same Tracking Schedule

If you’ve ever had a sibling, you know the chore lists must be shared and equal. All too easy to start a “wait but why” conversation if the best practice for one person looks different than the next. Set a schedule that makes business sense: If it’s expected that Team X track daily, make sure Team Y does too. If timesheets are locked for one group at 5 pm Friday, then they should be for all groups (unless there is a business case on why).

Best Practice #8: Assign a Time Checker/ Troubleshooter

Picture this: it’s Friday at 5:30, you really want to wrap up that project before the weekend starts, so you finish the work, hit send, close your laptop and rush out the door toward sweet weekend freedom without thinking twice about your timer. Whoops. Have one person (this is usually an HR person, office manager, or executive assistant) who is in charge of making sure timesheets look “normal” and accurate, and who has the right EQ to chase down stragglers (and who knows when to escalate to their manager). This person can also function as the go-to for training new employees or if an employee needs a locked timesheet edited, which will alleviate even more headaches for you and your team.

Best Practice #9: Keep the Trust Alive

Trusting employees is hard, especially if you’ve been burned before by someone forging time. Know that strong policies, having a point person observing timesheets, and following our other best practices on this list will help keep your trust in your employees alive. For the 95% who are going to follow the rules, this trust is key to their happiness at your business and for you to have low employee turnover. After all, people leave managers, not companies. Make sure you have that trust for them in their time tracking, and they will reciprocate.

Best Practice #10: Use Your Time Data

Not sure if you need to hire or downsize? Use your time data to tell you the story. Need a client referral story on timing and budget? Your statistics can outline exactly how much time was spent on each task. If you track effectively, your time data can tell you pretty much anything you’ve wondered to know about where you and your employees actually spend their time. Data makes it easy to spot and correct inefficiencies, notice who adds the most value where, and inform strategic decisions about the future. Time data also can be an excellent source for marketing materials, like pitch decks and case studies, to show your company’s abilities and efficiencies.

Best Practice #11: Tie Activities & Tasks to Projects or Clients as Much as Possible

“Where does checking emails fall?” “What about the 30 minutes of my day I spend organizing my day?” These questions will be abundant amongst employees and having answers in advance will help. Figure out what should be considered “internal” or “company” time, and make projects to track this time as well; then link as much as possible to projects or clients to get the most accurate billing. For example, if you are a recruiting firm, and you have a team member who has 50 emails from applicants for a position---- that should be tracked to the CLIENT, not as internal email tracking!

Best Practice #12: Encourage the Avoidance of Multitasking

Especially if you are in a patient or client billable field, like a law firm or medical practice, you will want to encourage employees from multitasking so that time that should be billed out is done so accurately. Not to mention, so that the work is done well! Have you ever sent an email to the wrong person? Embarrassing mistakes like those don’t happen when you’re fully focused. One thing at a time produces the best and most consistent results, and leads to the most accurate billing from time tracking to your clients.

Best Practice #13: Set Time Tracking Goals for the Team

Everyone’s timesheets done accurately or early one week? Coffee on Monday on the house! Everyone compliant for a whole month? Lunch is on the boss! Think of fun incentives that get your team or teams into the spirit in a fun way, and promote the proper use of your time tracking system.

Hint: involve key employees and managers to figure out what would really get people going, versus just assuming you as the owner, CEO or “big boss” know!

Best Practice #14: Train, Train, and Train Your Managers Again to Ensure Consistency

Same as best practice #2 above on training employees, you will want to make sure your managers are also all on the same page as well. If Jimmy learns he can ask Manager Molly a question and then ask Manager Mike the same one and get two different answers, you’re going to have issues on your hands. Having the management team on the same page, and having them be accountable to the policies and to the time “point person” will go a long way to avoid the “but I saw Jimmy doing it this way” problem.

Best Practice #15: Make Sure Everyone Understands Why You Time Track

Hint: it’s not just for payroll!

It’s human nature to feel that time tracking is management’s way of “watching you”. A lot of times though--- it’s not! It’s management wanting some sort of data on where time is spent so that salespeople can better estimate scopes of work. It’s so that clients are billed accurately. It’s so that you can have a handle on your all-remote workforce since you aren’t in an office together. Whatever your company’s why (or multiple why’s) are, convey them to your team and remember point #9- keep the trust alive!

Best Practice #16: Share the Data & It’s Uses with Employees

4 Point Consulting is very proud of a lot of our time tracking data. We boast record rates for recruitment placements at very small fees and we can do a lot of HR work in a little time. As the CEO of 4 Point, I share this data with my team because they should be proud of how good they are at their jobs. I also explain to management then about how to properly scope work for clients, and for salespeople, how to sign contracts. It also is great for my Marketing Manager to continue to improve our website and sales collateral. Finally, I love the data because it ensures our finances are in order, it’s how we bill clients, and it can tell me if I need to be cognizant that we need to hire someone else. Data = power!

Best Practice #17: Be Careful about tying Time to Performance

While people got gold stars for perfect attendance in grammar school, that should not be the case with time tracking in the “real world”. Tying time to performance could cause issues; i.e. what if an employee has a disability and thus has more breaks to accommodate their disability? Thus, using time tracking as a component of performance could put you in hot legal water. Not worth it!

On the other hand, using time tracking for rewards that build team spirit can be a great idea. I.e. Team A in Customer Service versus Team B in Customer Service and seeing who can turn in their time cards on time each week for a prize like a coffee on the company can be a lot of fun!

Best Practice #18: Consider a Pilot Program (if you don’t already track time)

The classic saying of “you should try it before you buy it” makes sense with employee time tracking if it would be a new policy. What is the management’s motivation? What will it do for your culture and does it align with your values? Do you have a clear idea of the policies you want around it and why? Have you communicated all of the above to your managers and team members? With any system, trying a pilot to make sure it’s a good fit is best practice for time tracking, and it also allows the perk of being able to tweak any bugs prior to full roll out (which means less headaches for you in the future).

Best Practice #19: Have Clear Policies on What Should/Should Not Be Tracked

Piggybacking off of best practices 11 & 12, make sure everyone is clear on what tasks and time should and should not be tracked. For example, when I was in house HR at a call center, a lot of workers would clock in and then go to the bathroom & get a cup of coffee, knowing that they could be idle for up to 10 minutes with the timer still running. This was a big pain point of the Call Center Manager, so he and I came up with a plan and policy to incentivize people to start their time AFTER the coffee/ bathroom morning break, and we openly and amply rewarded those who obliged by the new policy. The good peer pressure worked, and ta-da- no more wasted 10 minutes of payroll/ company time for 80 employees every day (over $100K per year!).

Best Practice #20: Lock Timesheets

To avoid confusion or uncontrolled editing of time, locking time sheets at the end of a week or month is best practice in order to get the most credible data and to have your accountant not go crazy (or your payroll person). Remember, you should assign a point person (#8 above) to be the one place to stop is a timesheet needs to be edited, and there should be a documentation process as to why for performance, tracking, or client purposes.

What have you found to be the most useful time tracking best practice from above, or do you have one we don’t list? Feel free to comment below!

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