7 ways to track employee time and attendance
Mobile time tracking apps
Mobile time tracking apps are a good solution for remote teams and employees who visit multiple worksites throughout the day. Employees can track time from anywhere using the mobile devices they already have in their pockets.
Best of all, mobile time tracking paired with GPS location technology helps curb time theft and buddy punching. Supervisors can see who’s on the clock and where they’re working, ensuring employees are on-site when they’re supposed to be. And when it’s time to run payroll, employees can submit timesheets from an app, so payroll is always on time and accurate.
Geofencing technology
GPS location tracking paired with geofencing technology makes it easier for employees to track time upon entering and leaving a job site. Time tracking software with geofencing allows managers to set virtual geofences around various job sites. When employees enter and exit the geofence, the software prompts them to clock in and out.
The result is fewer timesheet edits, added protection against buddy punching, and an easier employee time tracking experience overall. 72% of respondents surveyed in 2018 report a positive experience with geofencing in the workplace.
Wall-mounted punch clocks
Business owners with employees at one location, or who prefer employees track time from one device, may benefit from a wall-mounted punch clock. Traditional punch clocks require employees to insert a physical time card. The punch clock then stamps the time in or time out on the card. This type of punch clock is prone to buddy punching. Meanwhile, workers can lose or damage these time cards easily.
Digital punch clocks can be more reliable. Employees either swipe a card or enter a PIN to track time. However, these punch clocks are still prone to buddy punching. Curb buddy punching with a punch clock that verifies employees are on-site using personal PINs or photo identification.
Printable timesheet templates
Many business owners say they still use printed timesheets to track employee time. This method of attendance tracking requires employees to fill out a paper timesheet at the beginning and end of each shift. It’s a common method, but it can result in inaccurate payroll, time theft, and even labor law violations. After all, wage and hour laws require business owners to keep accurate employee time records for up to two years. Paper timesheets won’t make that easy.
If you choose to track time and attendance using a printable timesheet, make sure workers can use it to track overtime hours, breaks, and time off. Keep in mind that these timesheets can help you calculate a worker’s basic pay. But they don’t include things like taxes, health care costs, or other paycheck deductions.
Excel timesheet templates
Excel spreadsheets are a step up from printed paper timesheets. They’re less likely to be lost or damaged, but they’re still prone to errors and inaccuracies. Using Excel timesheets, employees must enter their work hours, breaks, and overtime manually.
If you use Excel timesheets to track employee time, make sure your employees can access and understand how to use the spreadsheet. Then keep backups of your spreadsheets for at least two years to comply with wage and hour regulations. When it’s time to run payroll, ask employees to verify and sign their timesheets to avoid payroll discrepancies.
Time and attendance software
Time and attendance software could be the best solution for employees who primarily work on computers. Employees can clock in when they start working and clock out when they stop working using a web-based solution or desktop software. Employee time data is stored digitally or in the cloud. Running payroll can be as easy as exporting that time data to your preferred accounting software. Additionally, many accounting software solutions include a native time and attendance tracking component.
Time clock kiosks
A mobile or tablet-optimized kiosk is a great solution for business owners who prefer to have employees track time from one device. Managers can move time clock kiosks from place to place throughout the day. They can even enable time clocks on several devices, so workers at different job sites can track time easily. For example, a catering company may use time clock kiosks to track employee attendance at various events held in different locations. Or a construction company might use a kiosk at each job site.
How to initiate an attendance policy for your business
A comprehensive attendance policy improves productivity, reduces absenteeism, and sets clear expectations for your employees. It should clearly define:
- When you expect employees to be at work.
- How workers can track their time and attendance.
- How workers can request paid or unpaid time off.
- What workers can expect if their manager doesn’t approve their time-off request.
- How workers can approve their time cards before they submit them for payroll.
An HR expert or employment attorney may help you craft your attendance policy. But remember, there is no one-size-fits-all solution. Policies vary depending on the nature of your business, your employees, your schedules, and more.
Once you’ve got a policy in place, take these steps to implement it.
1. Add the policy in your employee handbook
You should make your policy available and accessible to all employees at all times. Include it in your employee handbook, post a copy in the breakroom, and post it wherever you keep company resources online. Do whatever you have to do to get the policy in front of your employees.
2. Communicate the policy to employees often
Share your attendance policy with new employees during your onboarding or orientation period. But don’t stop there. New employees have a lot of information to take in during their first few weeks. Review your attendance and other company policies with all employees consistently.
3. Enforce the policy uniformly
Your time and attendance policy should apply to all employees equally. One employee or group of employees with similar jobs should not be exempt from the policy when others aren’t. This could lead to claims of favoritism and discrimination.
4. Recognize employees who abide by the policy
Motivate your team to abide by the attendance policy by rewarding those who do. Implement attendance tracking awards and reward employees for following the policy. Use gift cards, extra PTO hours, or other perks.
5. Encourage planned PTO
Employees need time off to unwind from the daily grind. An attendance policy shouldn’t discourage employees from taking time off. Encourage employees to plan ahead. Planned PTO can help regulate and reduce unscheduled leave.
How tracking employee attendance helps your business
Productivity losses from missed work cost U.S. employers an estimated $225.8 billion each year, according to a 2015 report from the CDC. That’s $1,685 per employee. Losses include but are not limited to absences due to illnesses, injuries, and mental illnesses like depression and anxiety.
An employee attendance policy can help you reduce unexcused absences and increase employee morale. 69% of business managers say unplanned absences add to the workload, according to a 2014 survey by the Society for Human Resource Management. 61% said these types of absences increase stress. 59% said they disrupt the work of others. And 48% said unplanned absences hurt morale.
The bottom line: You staff your business intentionally. You hire the people you need to get the job done. If those people don’t come in for their shifts, it affects your productivity and critical operational needs. It impacts your team’s ability to collaborate and work together. When employees consistently come to work, morale, productivity, teamwork, and business performance improves.
This article originally appeared on QuickBooks and was syndicated by MediaFeed.org.
How to automate your small business taxes
The taxability of a given product or service can vary from state to state, and in some cases, such as in Colorado, taxability can even vary from city to city. Location isn’t the only complication businesses face when calculating sales tax. Specific products and services can also have special or reduced rates and fees that need to be calculated at the point of sale
This is why mapping products and services to an appropriate tax category in any automated tax system are both very important and very powerful.
Sales tax is often complicated. Properly mapping products and services in your tax system will ensure that the correct taxability determination, accurate tax rate, and any applicable fees are being calculated for every sales transaction. (Curious how sales taxes affect your bottom line? Check out our sales tax calculator.)
The need for mapping products and services to tax categories is most apparent in these major areas:
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In the US, four states provide general exemptions for clothing, three states provide an exemption as long as the clothing is under a certain dollar amount, and one state taxes luxury clothing at a higher rate. The definition of what qualifies as clothing (clothing accessories, work clothing, protective equipment, etc.) is not uniform from state to state, so an item may qualify for the clothing exemption in one state but not in another.
To further complicate the issue, in 2018 sixteen states had sales tax holidays that provided exemptions for certain articles of clothing for limited periods of time.
Looking at the states with clothing dollar amount thresholds, we see that Connecticut, Massachusetts, New York, and Rhode Island are all subject to different thresholds. The thresholds are $50, $175, $100, and $250, respectively.
These states not only differ in thresholds, but they may also differ in how purchases that are over each unique threshold are treated.
Massachusetts
Massachusetts has a 6.25% sales tax rate for the entire state. For clothing, only the amount over the $175 threshold is subject to sales tax.
- Sales Transaction A: $100 Blouse. No sales tax applies because blouse is under $175.
- Sales Transaction B: $200 Blouse. Sales tax applies only to the portion over the threshold; $25. $200 – $175 = $25 * 6.25% = $1.56 Sales Tax
New York
New York has an 8.875% sales tax rate in NYC and other rates vary depending on the location of sale. For clothing, the entire amount is taxable if the item is over the $110 threshold.
- Sales Transaction A: $100 Blouse. No sales tax applies because the blouse is under $110
- Sales Transaction B: $200 Blouse. Sales tax applies to the entire item price; $200. $200 * 8.875% = $17.75 Sales Tax
If the taxability of clothing seems complex, it gets even more complicated as you look at more and more states. For example, one article of clothing that costs $1200 would be subject to different thresholds Massachusetts, New York, and Rhode Island, as well as taxable at a special rate in Connecticut, while being fully taxable in some states and exempt in others. Clothing rules can be more problematic than you think.
This shouldn’t make you worry. Properly mapping your clothing products to the correct clothing tax category in an automated sales tax system will ensure that the proper taxability determination, rate, and threshold rules are applied across all taxing jurisdictions.
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In 2018, seventeen states had sales tax holidays that exempted certain categories from state sales tax for limited periods of time. These categories included items like: back to school supplies, energy star appliances, and hurricane preparedness items.
Sixteen of these sales tax holidays exempted clothing. As a small business owner, you have to keep in mind that the sales tax holiday exemptions have similar intricacies as the year-round exemptions, including the definition of what qualifies as clothing for each holiday and how the thresholds vary from state to state.
For example, Alabama, Arkansas, Connecticut, Iowa, Maryland, Mississippi, Missouri, New Mexico, Oklahoma, Tennessee, Texas, and Virginia exempt clothing up to $100 during their sales tax holidays, while South Carolina has an unlimited exemption, Massachusetts exempts up to $2,500, and Ohio and Wisconsin exempt any clothing item under $75.
Your automated tax solution will automatically account for these sales tax holiday rules, as long as your products are set up correctly. In other words, in order for an exemption to properly calculate during a sales tax holiday, the item being sold must be properly mapped to the appropriate tax category.
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The majority of US states impose special rules on food. Most states exempt food for home consumption from sales tax entirely. Arkansas, Illinois, Missouri, Tennessee, Utah, and Virginia have special reduced rates for food for home consumption. Arizona and Louisiana exempt food at the state level but tax it at the general rate at the local level (some exemptions/reduced rates apply).
While individual states are ultimately responsible for defining the exact scope of special sales tax rules related to food and beverages, food for home consumption is generally accepted to include staple grocery items and foods which are not prepared prior to purchase and are not meant to be consumed on-premises. Candy and soft drinks can be included or excluded in this definition, depending on the state.
Many states, including Member States of the Streamlined Sales Tax Agreement, exclude prepared food, dietary supplements, and alcoholic beverages from the definition of eligible food for home consumption.
Example: A liter of soda is fully taxable in Minnesota and Illinois, while fully exempt in Massachusetts.
Example 2: A loaf of bread is exempt in Minnesota, taxable at a reduced rate in Illinois, and exempt in Massachusetts.
Again, properly mapping food items to the correct tax category will ensure that the proper taxability decision and reduced or full rates are applied across all jurisdictions.
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While most states provide an exemption for food for home consumption, food intended to be consumed on-site in places such as in a sit-down restaurant or when ordering take-out is generally taxable. Some states tax this type of food at the general rate, while others have special rates, called a Meals Tax.
Many local jurisdictions also impose a meals tax, even in states that have no other local taxes, such as Massachusetts or in states with no state sales tax, such as New Hampshire.
In an automated sales tax system, these rules will seamlessly be applied to your transactions once you have mapped all of your products and services accurately.
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Medical products is another area where states enact special tax rules. Many states provide a sales tax exemption for prescription drugs. The definition of what qualifies as a prescription drug, just like clothing and food, can differ from state to state.
For example, some states such as Missouri, exclude over-the-counter prescription drugs from their exemption. Other states such as Texas, exempt all drugs, regardless if they are or are not given under a prescription.
Why mapping is important in this area is because some states have a very broad definition of what qualifies as a “drug.” States are also increasingly providing exemptions for other medical items, such as feminine hygiene products.
Properly mapping a medical product to the most specific tax category in your automated tax system will ensure that the proper taxability determination is being applied across all jurisdictions and that your customers are getting all of the exemptions that the states have to offer.
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Products that are not exempt in any jurisdiction and are not covered by any sales tax holidays may still need to be mapped in your automated tax system to ensure not only a comprehensive collection of all relevant taxes but also of all applicable fees.
States may impose fees on items such as lead-acid batteries, tires, electronic items, bottled water, soda or alcohol containers, and E-911 charges.
Mapping to the proper tax category for these types of items will ensure that the proper taxability, as well as any applicable fees, are calculated by your automated system.
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The treatment of software and related services differ significantly from state to state. Prewritten software provided in tangible format is taxable in every jurisdiction with a sales tax. The treatment of software transmitted electronically, on the other hand, varies from state to state and can vary for a variety of reasons, including whether the software is custom, prewritten, transferred with tangible personal property, or comes with upgrade, updates, or technical support services.
The treatment of Software as a Service (SaaS) and other software related services also varies widely from state to state.
Similar to clothing, food, and medical items, not only does the sales tax treatment differ for SaaS, but the definition of what qualifies as SaaS and other software related services differs by state. This is another reason why it is critical to pick the most specific tax category that matches the products your business sells.
Software-related services may also be subject to special rates, such as the 1% Connecticut rate for computer and data processing services, or in Texas, where data processing services are only taxable at 80% of the base.
Automated Tax systems provide a significant number of software and software services tax categories where the underlying taxability is maintained across all jurisdictions and helps your business ensure the proper calculation of rates and taxability.
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Given the many variables and complexities around sales tax product and services categorizations, the solution is probably not DIY. When set up properly using a comprehensive software, you can take all of your compliance issues and turn them into an automated process that seamlessly and effortlessly calculates the right tax, at the right rate, for every transaction.
This article originally appeared on the Quickbooks Resource Center and was syndicated by MediaFeed.org.
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