Want to keep time on your side? Then you need a clearly defined time tracking policy. Here’s the quick rundown on how (and why) to create time sheet guidelines, including a free template to help you get started.
Time sheet policies lay out the parameters for employee time tracking in a formal document. These guidelines objectively outline the expectations for your workers as well as explain the rationale behind the policy.
When tracking employee time, it’s important to create a time sheet policy. That’s because a policy standardizes procedures across your organization’s hierarchy. Since policies are objective, it’s a fair way to ensure each worker follows the same requirements.
A clear policy around time tracking is also important to your bottom line. Time tracking policies can help set transparent goals around productivity, profitability, and annual performance. They’re also helpful for managing both individuals and teams.
Policies surrounding hours worked can also outline general procedures for attendance, overtime, leaves of absence, sick days, and paid time off. Because keeping accurate records of hours worked is necessary for legal compliance, clearly outlining your time sheet procedure can help get everyone on the same page about how to track time in your place of business.
Your policy surrounding work time may vary based on whether you have mostly exempt (salaried) or nonexempt (hourly) employees.
The Fair Labor Standards Act requires that nonexempt employees be paid at least minimum wage and all applicable overtime pay. While federal law requires overtime pay at a rate of time and a half when 40 work hours are exceeded in a single workweek, overtime is regulated by state laws, which may be more stringent (e.g., a pay rate of time and a half after eight hours in a single workday).
The FLSA considers certain workers “exempt” from overtime pay. Generally, an exempt employee is paid a salary that meets the minimum requirements for his or her job type or industry. Even though these workers are not hourly employees, you can still require exempt employees to track their hours worked.
Keep your time tracking policy as simple as possible. Include the following information:
Below is an example of a simple time tracking policy you can use with your OnTheClock software.
Important Note: The policy below is a sample intended to be used as a general guide. You’ll need to adjust this to meet legal requirements such as your state law overtime laws. We also recommend making modifications to this free template to meet your unique business needs and industry standards.
This policy outlines the requirements for employee time tracking. Its purpose is to establish guidelines and procedures to ensure accurate records of employee hours and to facilitate efficient payroll processing. All employees of [Company] must follow the procedure laid out below.
This policy is effective as of [date].
[Company]’s workweek covers seven consecutive days, beginning on [day] at [time] and ending on [day] at [time].
In [your state], overtime is defined as hours worked by a nonexempt employee in excess of [40 hours in a workweek, eight hours in a single workday, or other, depending on your state law]. Overtime does not apply to exempt employees. All employees are expected to record working hours for compliance.
Employees must track working hours using the designated time clock software. Other approved methods may be provided on an as-needed basis.
Any violations of this policy will be taken seriously and may result in disciplinary action up to and including termination of employment.
By adhering to this time tracking policy, we can ensure accurate and fair compensation while maintaining the integrity and efficiency of our payroll processes.
Please provide a signature to acknowledge you’ve read and understand this policy.
(First and Last Name)
(Today's Date)
Want to make your time tracking procedure successful? How you introduce it matters. If time tracking will be brand new to your staff, you may deal with some pushback during implementation.
To ensure successful implementation of time tracking, follow these five steps:
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