The Fair Labor Standards Act (FLSA) establishes guidelines related to employee hours, overtime and wages. The law also governs record-keeping practices for nonexempt employees. Many employers find that using a time-clock is the most effective way to maintain FLSA compliance. To help you choose the best timekeeping method for your business, here are some time clock rules for hourly employees:
1. Tracking Time
The FLSA gives employers the freedom to track time any way they want. The only stipulation is that the timekeeping method must accurately record amount of time worked. With timekeeping software like Mitrefich time and attendance systems, employers can safely, securely and accurately track employee time. Clocking options include:
Biometric clocking.
This method uses a biometric scanner to track the arrival and departure times of each employee. These compact scanners can easily be installed at convenient locations throughout a facility. Benefits of biometric clocking include increased security, fewer overpayments and fewer occurrences of time clock fraud.
Proximity clocking.
This system uses a variety of different input methods such as swipe cards, key fobs or ID badges to record employee time. Proximity clocking can also be a great way to limit employee access to restricted areas.
PC Clocking.
This method is ideal for office workers, traveling employees or field workers. PC clocking allows employees to manage their time from a personal computer. With no software installation requirements, this system can easily be used anywhere with an internet connection.
Mobile phone clocking.
If your workforce is mobile, your clocking system should be too. A phone clocking system allows employees to use their mobile phones to record time punches from wherever they are.
SMS Clocking.
This method allows employees to record their time using text messages from their mobile phone. Each time an employee texts a virtual phone number, their time punch is recorded and available for instant viewing. Not only is SMS clocking simple and effective, but it requires only basic cell service to use.
With a variety of time tracking options available, employers are free to choose the one that best suits the needs of their unique workforce.
2. Rounding
When tracking employee time, attempting to account for every minute of their workday can quickly become overwhelming. Luckily, the FLSA allows employers to round the number of minutes reported. The way this works is that employers may round up or down to the closest tracked increment. This means that if a company measures time in 10-minute increments, they would round 28 minutes up to 30 or round 22 minutes down to 20. The use of electronic timekeeping software takes the guesswork out of rounding. These systems use a unique algorithm to ensure that time is rounded correctly every time.
3. The 7-Minute Rule
Typically, most companies track employee time in 10- or 15-minute increments. For increments of 15 minutes, 7 minutes is the cutoff for rounding down. If the employee works at least 8 minutes in that timeframe, the employer must round up to the nearest 15. By allowing clocked time of up to 7 minutes and 59 seconds to be rounded down, this rule plays slightly in the favor of the employer.
4. Other Considerations
The Department of Labor, the agency responsible for administering the FLSA, recognizes that holding employers accountable for every minute of work time is impractical. They also understand that it is unreasonable to expect employees to start or stop working in exact 15-minute increments. The Code of Federal Regulations prohibits employers from using the rounding system to take advantage of employees.
Staying on top of time clock rules for hourly employees is an essential part of running a business. Failure to adhere to these federal laws can result in hefty fines for each violation. Using an electronic timekeeping system is one of the best ways to avoid the hassle of manually tracking FLSA compliance. Not only are electronic timekeeping systems faster and more accurate than manual time tracking, but they also eliminate many of the human errors that can occur when time is being manually tracked. From ensuring that time is properly recorded to rounding time in the correct increments, electronic clocking software can be a valuable resource for any business.
