How do you know when it’s time to invest in software that will track your employee time for you? Not having to dip into the company budget each month for payroll and timekeeping software may look like big savings for the business, but examining the benefits of software will provide a different perspective on where even greater savings could actually come from.
How your company collects employee time is the beginning point of savings. Using a timeclock system whether it’s biometric, digital punch, or recorded in a computer database will allow for an easier and more accurate capture of employee shift work. Hand punched timestamps are often difficult to read and errors are more frequent.
Another benefit of time capture is that it is much more difficult for workers to steal from the company through time theft. If your workers are hourly and non-exempt from overtime, they could potentially be fudging time here and there throughout the week to qualify for overtime payment. There are many studies showing how electronic punches such as badge readers can save on payroll (between 2-4%) by eliminating time theft.
If you are going to switch from manually calculating time cards to paying for an installed or cloud-software payroll and timekeeping service, you are going to need to justify a solid return on your investment. Some things to consider when determining if a switch is “worth it” or not is that your business will be saving on paper costs from no longer needing punch cards, timesheets, time spent on filling out the timesheets, and time transferring information. The average savings from paper elimination is about .2% of every payroll.
In addition to saving on time spent using timesheets, you will quickly find that time will be saved from not having to key in data entry from hours punched. Having automatic rollover from hours worked to payroll will also eliminate human error that could cause over or underpayment to employees. Removing calculation errors also means saving on paycheck corrections which can cost around $15 for re-issuing a check.
Single Source Solution
If and when you do decide to switch from manually calculating time cards to implementing an installed or cloud-based platform, having a single-source payroll and timekeeping software is a huge benefit that shouldn’t go unnoticed. Paying to have a single-source platform that is able to easily transfer your employees’ timekeeping info into a payroll database is an excellent way to ensure that time, resources, and money are all being saved.
Source: American Payroll Association
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