How to track employee hours: everything you need to know
Do you track employee hours? If not, you should know that this could cost you and your company some money. And when we say “some money”, we actually mean thousands, or even millions, every year.
According to some data retrieved by Finances Online, the US economy alone loses $11 billion because of time theft, which is the act of accounting for more hours than the ones you worked for.
The same source states that $7,4 billion and 50 million hours are lost every day due to unrecorded activities.
These numbers alone show us the importance of time tracking. Besides being a mandatory implementation within the European Union, tracking employee hours can present some major benefits, such as:
- keep track of accurate payroll hours, for companies working with hourly employees;
- provide a better understanding of what the working hours are spent on;
- keep track of the correct amount of billable hours, for companies working with hourly rates for clients.
Now that you know the importance of tracking employee hours, the question is: how can you do it?
Keep reading this blog and find out how to track employee hours. Discover the best techniques and tools, the pros and cons of each, and which technique gives you the best results.
How to track employee hours: 6 ways you need to know
1. Pen and paper
The old pen and paper. And yes, even though we’re becoming more and more digital as a society, there are still some companies (especially small businesses) that still rely on the pen-and-paper technique to keep track of employee hours.
Keeping track of employee hours by pen and paper is free, simple, and can be done with no technical knowledge. You just need to know how to write and how to count: easy.
There are much more cons than pros when it comes to this technique. It leads to huge amounts of paperwork, which can be lost or misplaced. It’s very time-consuming and it can lead to fraud. Even though it could have been a great technique in the past, it’s just not the case anymore.
2. Digital time tracking templates
Tools like Microsoft Excel and Google Sheets are widely used to track employee hours.
The employees just need to add the time they spent on each task, and, if the Excel sheet is programmed with the right formula, the number of working hours will be calculated automatically, by day, week, month, and year.
For anyone who is used to working with Excel, this is a relatively simple method to use. It’s very customizable, the formulas are easy to replicate, and you can also add additional formulas of your own if you need to.
If each employee sends a separate Excel timesheet, it can be easily misplaced or lost.
It’s also very time-consuming to create, fill out and approve, and it doesn’t account for vacations, sick leaves, or paid time off unless you add more formulas, which can complicate the process.
It’s also usually filled out at the end of the billing period with “estimations” on how time was really spent.
3. Time clocks
These tools have been around since the late 1800s. They can take on different forms, such as card swipes or biometric time clocks.
How they work is very simple: the employee arrives at the job site, swipes a card, or does a biometric check, which can be done by retina or fingerprints.
The same applies when the employee leaves the job site. The hours between these two actions are accounted for as “working hours”.
This is a very simple method to use, as it only requires two simple actions from the employee. The data is automatically saved to the time clock system and the total number of working hours is then automatically calculated.
Time clocks are very expensive to implement, and even more so if the company has several working sites. Also, depending on the method used (card, fingerprint, or retina), they can be a very unsanitary solution, if not cleaned regularly.
They can also be very impractical if the company has a very mobile workforce that will work some hours at different job sites.
Last but not least, this technique is not remote-friendly, as it only allows tracking hours of people who are physically present at the work site.
4. Time tracking app
Using a time tracking app means automating and streamlining the entire time tracking process for employees.
They can enter their time manually, or track it as they work, and the system will automatically calculate their daily, weekly, monthly, and yearly working hours.
This is a completely automated method – employees just need to log in to track their time, and managers or HR workers just need to log in on their end to export the timesheets of all the worked hours.
These timesheets can be customized by time period, project, client, and so on. It’s a very detailed method, as it keeps track of working hours in real-time, with the hours always being attributed to a certain task.
Time tracking apps are super remote-friendly. They make keeping track of breaks, sick leaves, or paid time off even easier and are very simple to use, once you learn how to take the most advantage of them.
Lastly, most time tracking apps nowadays give you the option to use them on the computer or on a mobile phone – a very practical solution for people who are always on the go!
Depending on the app you choose, it can take some time to train employees on how to use it. Also, some apps are not available for mobile phones, which takes away a little bit of the versatility of the tool.
5. GPS and location tracking
For companies that provide field service, it’s a common practice to use GPS technology services to track the hours employees spend working on the field.
It’s a simple way to track the time employees spend outside the office site.
The hours tracked still need to be calculated manually, as you still need to check the GPS tracking system and retrieve the information for yourself.
It can also be viewed as a way for employers to control their employees when they aren’t present at the office.
6. Monitoring tools
Methods like monitoring phone calls, emails exchanged, or computer activity are still used by some companies nowadays. They are performed via monitoring software, which records all the activity performed on a computer or phone.
This is a method that should be avoided at all costs by companies and therefore has no pros.
Monitoring employees’ activities show a lack of trust in their work and can put them under great levels of stress and pressure to be monitored.
This can later lead to decreased productivity and lack of motivation.
Make sure you use transparent tracking methods to avoid workplace conflicts and respect employee privacy.
Some questions about employee hour tracking you might still have
Is there an app to track employee hours?
Yes, there is! There are some time tracking softwares that also include an app, which can be used both on a computer and a mobile phone.
How to track working hours on Google Sheets?
You can use Google Sheets to keep track of work, even though it can be time-consuming. You’ll need a formula, to automatically calculate your working hours and an input method.
You can do it by total hours worked during the day, billable vs non-billable hours, hours spent on each project, etc. You determine what works best for you!
How to track employee hours on Excel?
Tracking hours on Excel is almost identical to tracking hours on Google Sheets. You’ll still need an efficient input method and the formula you intend to use.
How to track the hours of employees working from home?
One of the best ways to track employee time remotely is to use a time tracking tool.
This automated and digital method will easily track working hours, connecting the data in real-time to the person in charge of keeping track of the employees’ working hours.
How to track working hours on an iPhone?
The best way to track working hours on an iPhone is by using a time-keeping app, also known as a time tracking tool or app. Why? Some time tracking apps like Timeular have a mobile app version, which can be used on an iPhone as easily as they are used on a computer.
Which one is the best way to track employee hours?
The answer to this simple question is also simple: it depends.
Different solutions can work for different companies and businesses.
When looking for an hour-tracking solution, you should make sure you choose the method that “steals” little to no time, is automated, easy to use, and, if possible and applicable, remote-friendly, as remote work is becoming increasingly popular worldwide.
Choose what’s best for your company and for employees and streamline your time tracking processes today!
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