What is a time and attendance system?

Time and attendance systems are the modern-day equivalent of the paper time sheet or punch clock. They automate day-to-day tasks such as tracking work hours and calculating accrued benefits, providing valuable information and making your business more efficient.

Whether due to overwhelming paperwork, rapid growth, or new efficiency initiatives, companies are turning to time tracking systems in record numbers. Vendors are responding to this demand with products designed for a variety of technical requirements and niche industries. As a result, time and attendance packages can now help your company automate not only the morning roll call but also your labor forecasting and management activities.

Is it right for you?

Time and attendance software can reduce the administrative hassles of managing paper time slips and reduce mistakes. They can also cut down on time theft: buddy punching, extended lunches, and other time tracking problems. 

Most companies find they need a time and attendance system when they have about 25 employees to track. Companies with more than 250 employees often turn to more robust systems that can create complex schedules and generate detailed productivity reports.

Not every large company needs a time and attendance system, however. If your staff is primarily salaried or if your time sheet paperwork is manageable, a time tracking system is probably more than you need.

How it works

Employees use identifying cards to punch in and out. Proximity cards – which only need to be waved near a reader – and magnetic stripe cards are the most common. For security purposes and to avoid buddy punching, some companies use biometric input devices that check fingerprints or handprints to ensure that the correct person is logging in and out.

Most companies rely on administrative staff to enter attendance information for salaried workers. However, a growing number of companies let employees enter their own information directly into the time and attendance system, including flex-time hours, vacation time, and sick day information.

Basic time and attendance systems provide routine time tracking and schedule management, including setting break times, holidays, and whether overtime is allowable. With most systems, you can also track tardiness and patterns of absenteeism. They also include basic accounting, auditing and reporting tools, giving your managers easy access to employee data and the applications to audit it for accuracy.

More complex labor management systems designed for larger companies feature more functionality and more robust reporting. Managing labor data according to an employee’s job description, project, or location is common in these systems. Some even track production for those employees paid by per unit manufactured. This type of job costing is invaluable for companies that need to evaluate their workforce productivity or forecast their workforce needs.