Time Clock Procedures for Employers

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Time is money is a frequently heard saying, but time incorrectly recorded is either money underpaid or overpaid. To avoid this problem, companies should follow guidelines set by the U.S. Department of Labor. Using a time clock and giving employees a chance to review their time worked each week can help save time and money auditing work schedules to determine if pay is missing.

Not Legally Required

Employers are not required to use time clocks to record the time worked by employees, according to the U.S. Department of Labor Regulation 29 CFR 785.48 - Use of time clocks. It is up to the employer to determine the method used for recording time worked. If the company chooses to use electronic time clocks, a time card can be used to be scanned as the employee enters the office. Another method for electronic timekeeping involves the employee logging into a software program and clicking a button to "punch in" as if he was using a punch clock.


Rounding an employee's clock-in or clock-out time to the nearest tenth of an hour, quarter of an hour, or five minutes is permitted according to 29 CFR 785.48. If the employees can prove that the rounding regularly reflects less time on the clock than the time the employees actually worked, this process can be challenged. In general the policy believes that the rounding will even out over time. If a company has a policy in which the punch-in is rounded up to the next quarter hour and the punch-out is rounded back to the nearest quarter hour, this is something where employees can challenge the policy through their union or the U.S. Department of Labor.

Punching in Early or Punching Out Late

An employee is permitted to punch in a few minutes before or a few minutes after her normal starting and ending times. This is permitted as long as no work is performed during the time before or after his official start time. To avoid confusion though, the policy suggests that employers monitor this and limit the punches to only a few minutes before or after a shift and avoid allowing employees to be "on the clock" for significant periods before a work shift starts or after it ends.


At the end of each pay period, the employer should give the employee an opportunity to audit her time card. This allows her to verify that all the punches were correct and vacation, sick or administrative time off were applied properly to the time card. The employee and her direct supervisor should both verify that the time card is correct.