Time card approval is essential to ensure that employees are paid accurately and on time. We explain how time card approval works and highlight 3 automated tools that can streamline the process.
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Time card approval allows businesses to review the hours employees have logged and ensure that they’re being paid correctly for their work. It’s an important process that must be handled correctly. Otherwise, payroll could be delayed or employees could be over- or underpaid.
Therefore, it’s essential to understand exactly how time card approval works and what steps are involved. In this article, we explain everything you need to know and highlight 3 of the best automation tools to streamline your time tracking process.
- Time card approval is when employers review their employees’ time cards for accuracy and approve them for payroll.
- The process helps to avoid over- or underpaying employees, prevent payroll errors, and ensure that time cards comply with Fair Labor Standards Act (FLSA) requirements.
- There are digital tools you can use to automate your time card approval process.
- Connecteam is the best software for time tracking and time card approval for businesses of all sizes.
What is Time Card Approval?
Time card approval is when employers check how many hours employees have worked during the current pay period.
Employees will record their hours for each pay period on a time card. This breaks down each day in a pay period and shows all of the hours that employees have worked on each of those days. A pay period is usually 2 to 4 weeks. However, in most states, employers are free to decide how frequently they want to run payroll.
The goal of the time card approval process is to ensure that employees have recorded their hours correctly and to catch any mistakes before running payroll.
What should be included on a time card
A time card should include hours worked, as well as time spent on breaks and paid leave. It also needs to provide information about the tasks or projects employees worked on, particularly if employees are paid different wage rates for different tasks.
Checking time cards for accuracy
Employees should review their own time cards before sending them to you for approval. Once you receive an employee’s time card, you can check it for accuracy.
This accuracy check typically includes cross-referencing an employee’s recorded hours against their work schedule. If your company uses GPS location tracking to verify employees’ locations during work hours, you can also compare the employee’s location data against the hours listed on their time card.
Calculating overtime pay
You also need to calculate overtime for each employee and break it out on the time card. Overtime is required to be paid at 1.5 times an employee’s base wage rate and applies whenever employees work more than 40 hours a week. If employees qualify for other time bonuses, you can add these to the time card as well.
Approving or rejecting time cards
If all the information on an employee’s time card is correct, you can approve the time card and pass it on to your company’s payroll team.
If there’s any incorrect information, you can reject the time card and send it back to the employee for revisions. Once the employee has revised their time card, you can review it again.
Why Is It Important to Approve Time Cards?
Reviewing time cards helps prevent payroll mistakes. These mistakes could result in paying your employees incorrectly and even lead to legal issues.
On the flip side, when done properly, time card approval helps you:
Avoid pay discrepancies
Reviewing and approving time cards helps prevent your company from overpaying or underpaying your employees.
Overpaying workers can be very costly over time. Underpaying them is illegal and could lead to steep penalties from regulatory agencies. Not paying your employees correctly is also bad for their morale and could result in skilled staff members leaving your company.
Managers serve as a second set of eyes on employees’ time cards during the approval process. They can catch honest mistakes and spot potential instances of time theft. They’re also held accountable for the accuracy of time records that are used to process payroll.
Improve payroll accuracy
When all the time cards submitted for payroll are correct, you need to send out payments only once for each pay period. However, when time cards have mistakes, you may need to run payroll multiple times to resolve payment errors.
This costs time and money. It’s in your business’s best interest to reduce the number of payroll runs you need to make. Reviewing and approving time cards is key to achieving this.
The Fair Labor Standards Act (FLSA) requires companies to keep employee time cards for a minimum of 2 years. The time card review process ensures that managers collect time records for every employee during every pay period.
If your company ever faces an inquiry into your compensation practices, you can produce your time cards and be confident that they’re correct.
How Does Time Card Approval Help Employees?
The process of reviewing and approving time cards can also be beneficial for employees.
Employees want to be paid accurately for the hours they work, but they may occasionally make mistakes like forgetting to include a time entry. You can catch these mistakes and ensure that employees are paid for all of their hours.
Sharing time card information with employees also allows them to review the hours they’ve worked. This can help employees better understand how much they’re working and how much they should expect to be paid. It also offers more transparency in the payroll process, which can be great for employee morale.
Can Employers Make Changes to Time Cards?
You can do 1 of 2 things when you find a mistake as you review an employee’s time card:
- Reject the time card and send it back to the employee for revisions.
- Make revisions to the time card and approve it.
For legal reasons, it’s important that any changes made to a time card are backed by evidence. Managers might make changes when an employee forgets to clock in or out of work, for example. Or if PTO isn’t automatically added to time cards, managers might add those hours on behalf of an employee.
It’s always a good idea to let employees know when a change has been made to a time card and document that change in writing.
What Happens After You Approve Time Cards?
Once a time card is approved, it gets sent to your payroll team.
Typically, time cards can be imported into your payroll software without the need for manual data entry. Some timesheet platforms integrate directly with popular payroll platforms. You can also export time card data as a CSV and upload the file to your payroll software. Time card data is then used to process payroll.
After that, time cards should be stored securely for a minimum of 2 years to comply with FLSA requirements.
Using Automations to Track Employees’ Time
In the past, companies used machines that would stamp an employee’s time card with their clock-in and clock-out times. Today, most companies have eliminated physical time cards and instead rely on software to track employees’ hours.
Employee time clock software offers several features to help your business automate time tracking, timesheet generation, and time card approval. These features can cut down the amount of time it takes to create time cards. They can also help to ensure employees’ time records are accurate and that communication between managers and employees during approval is streamlined.
For more information, read our round-up of the 6 best simple time clock software solutions for 2023.
Here are a few examples of automation features that can improve your time card approval process.
GPS-enabled time tracking
A GPS-enabled time clock app can help you verify your employees’ locations while they’re on the clock. You can see where workers are when they clock in or see their locations while they’re on the go.
Then, when you review time cards, you can cross-reference an employee’s location against their time card entries. This helps eliminate time theft and enables you to check that every time entry is assigned to the correct project.
In addition, many GPS-enabled time clocks allow you to set up geofences around your office or a job site. When an employee enters or leaves a geofenced area, they’ll get a reminder to clock in or out of work. This ensures that employees never forget to clock in or out.
Overtime and break calculations
Timesheet approval software can calculate overtime and break pay automatically. This saves you from having to make these calculations yourself. Thus, it reduces the time it takes to approve time cards and ensures that employees are paid correctly.
Employee Time tracking software can also collate time entries and generate digital timesheets in seconds. This saves employees from making mistakes by not having to manually record their hours in a timesheet.
Time card notifications
Some software solutions let you leave a note directly on the timesheet if you need additional information about a time entry. Employees will receive a notification so they can provide information or make revisions quickly.
Best Tools for Time Card Approval
Let’s take a closer look at some of the top tools your business can use for time tracking and time card approval.
Connecteam is an all-in-one time tracking software that ensures your employees are paid accurately and on time. Our software has features to reduce missed time entries, speed up the approval process, and eliminate time theft.
Firstly, Connecteam makes it simple for employees to track their hours. A GPS-enabled time clock reminds employees to clock in when they arrive at a job site and to clock out when they leave. They can clock in and out from their smartphone with just a touch and categorize each time entry to a project or task.
You get to decide whether or not employees can edit their time entries manually, which can help eliminate time theft.
Connecteam will automatically gather employee time data, calculate overtime and break hours, and generate digital timesheets for each pay period. You can see at a glance how much employees worked, when they went into overtime, and when they were on break.
Another benefit of Connecteam is that you can keep employees in the loop during the approval process. You can chat with employees using Connecteam’s messaging features to ask for more information about a time entry. In addition, employees are automatically notified about any changes made to their timesheets. Once you approve a time card, it’s locked for any further editing.
Connecteam integrates with Quickbooks Online and Gusto for payroll processing. You can also easily export timesheets for use with other payroll software.
Connecteam is free for businesses with up to 10 employees. For larger businesses, Connecteam starts at just $29 per month for up to 30 employees. You can try out Connecteam free for 14 days to see how it can streamline your time card approval process.
TimeCamp is a time tracking app that supports daily and weekly time card approvals. The software also enables managers to set up reminders so that time cards arrive for approval before the payroll deadline.
In addition, TimeCamp supports comments within timesheets. This allows managers and employees to discuss time entries when more information is needed.
TimeCamp integrates with several productivity platforms that allow employees to track their hours automatically. However, it doesn’t offer any GPS tracking features, so it may not be the best choice for companies that have employees working in the field.
TimeCamp offers a free plan for unlimited users, but it only supports time tracking. Plans that include timesheet approval features start at $10.99 per user, per month.
Toggl Track is a time tracking software that integrates with over 100 popular platforms. These integrations enable Toggl Track to record employees’ hours automatically and classify work to specific projects. Employees can also start and stop time entries manually with a click or tap from their computer or smartphone.
Toggl Track assembles timesheets automatically and breaks down time entries by project or task. Managers can assign different pay rates to different projects and view time spent on breaks and overtime.
Toggl Track doesn’t offer any payroll software integrations, but it can export timesheet data as a CSV file. It also lacks built-in communication tools to resolve issues during the approval process. Managers and employees will need to communicate outside of Toggl to note any changes to time cards.
Toggl Track offers a free plan for businesses with up to 5 employees. Paid plans start at $9 per user, per month.
Time card approval is when employers check and approve employees’ time cards to make sure they’re accurate. The approval process helps eliminate payroll mistakes and ensures that employees are paid correctly. It’s also essential for complying with the FLSA’s compensation reporting requirements.
Using time card approval software can make it easier to create timesheets and cut down the time it takes to run payroll. We think Connecteam is the best tool for approving time cards at businesses of all sizes.
Try Connecteam free for 14 days to see how it can simplify your time card approval and payroll processes.