The Importance of Employee Time Tracking for Small Business Compliance

The Importance of Employee Time Tracking for Small Business Compliance

The Importance of Employee Time Tracking for Small Business Compliance – You’ve got a strong business, entrepreneurial spirit, and the right team. But are you fully prepared to be legally compliant? Navigating a sea of laws and regulations is a fact of life for small business owners. You must fully understand and comply with everything from tax obligations and local permit mandates to laws governing marketing and sales practices.

Laws also govern recordkeeping requirements, including those related to your employees’ time sheets. While you’re probably already using some form of employee time tracking to pay your team accurately and on time, you may want to consider if your current method is the best and simplest one for maintaining recordkeeping compliance.

Fair Labor Standards Act Recordkeeping Requirements

Federal, state, and local laws established by the Fair Labor Standards Act (FLSA) dictate what records you must keep for your non-exempt employees. It requires employers to keep accurate records for each non-exempt worker, including the following information:

Yes, it’s quite a bit of information to keep track of. And that’s not all. You must keep records for at least three years. Time cards, work and time schedules, and other pay computation records must be kept for two years. You’ll need accurate records in the event the United States Department of Labor investigates your business.

What could Prompt an Investigation?

The United States Department of Labor could review your timekeeping records if they believe you may not be compliant with FLSA laws. Investigations may be prompted by worker complaints, previous violations, a third party, or running a business in an industry with high labor violation rates, such as the food and drink service industry.

Among the things that investigators will look for are signs of wage theft, such as:

Penalties for wage violations can result in significant fines. Even if a violation is simply an honest mistake or oversight, as a business owner, you are responsible for knowing and complying with the law. Breaches are costly to your bottom line, reputation, and team morale.

Protect your Business with Easy, Accurate Time Tracking Software

Timesheet templates that require your team to track their hours, overtime, vacation days, and lunch breaks manually are one way to maintain compliance. Is it the optimal method? Not really. Manual data entry is time-consuming, which reduces employee productivity. Plus, it’s subject to human error. Team members may accidentally over- or underestimate their work hours—discrepancies that can lead to time theft or wage theft, both of which you want to avoid.

The better, more efficient way to track team member time for both payroll and compliance purposes is time tracking software that works with a mobile app. With employee timesheets in the palm of their hand, your team can track time right on their phone, wherever they are. Your employees will appreciate the time-saving convenience, and you’ll appreciate the peace of mind that comes from accurate reporting of work hours and other labor data. Small businesses around the globe are discovering the many benefits of time tracking software:

The Across-the-Board Project, Payroll, and People Management Benefits

Whether you’re overseeing your crew or your costs, you’ll find time tracking software to be a valuable business asset with a wide range of capabilities. While software features vary by product, you may be able to:

One Less Risk you have to Worry About

There are always risks when running a business. Don’t let the consequences of regulatory noncompliance be one of them. The Importance of Employee Time Tracking for Small Business Compliance software is a small investment that can help mitigate big legal hassles. It’s a wise decision for the longevity and growth of your business.

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