Believe it or not, some HR departments are still processing their timesheet records by hand. While this is common among smaller businesses, there are a number of downsides to doing so, and these disadvantages will become more serious as the company grows in size. Below are some reasons why you should phase out manual timesheet records.
High Administrative Costs
When you use traditional timekeeping systems, this requires the administration staff to spend hours dealing with inaccurate timesheets or info which is missing, and everything must be manually entered into the system for payroll. This ultimately leads to higher administrative costs which are unnecessary. Modern time and labor management systems, by contrast, allow payroll to be completed in minutes, which means HR staff is free to work on other tasks which boost productivity.
Increased Employee Turnover
Incorrect timekeeping, along with prohibited access to basic payroll data, quickly causes frustration among employees. Few employees will tolerate any delays or problems when it comes to receiving their salary, so any business that operates in this manner can expect an increased turnover. Furthermore, they will fail to attract the type of talent that will be needed to make their company competitive in the marketplace.
Increased Time Theft
One reason why so many businesses have abandoned manual timekeeping, aside from the inefficiency, is the rampant time theft that is associated with it. Traditional systems are vulnerable to a number of exploits which include things such as buddy punching and hour padding. By switching to atimekeeping system which is automated you’ll probably be surprised by the decline in worker hours for the initial pay period. Even if the reduction is only modest, this benefit will compound over time, which will more than pay for the cost of acquiring and implementing the new system.
Most traditional, manual timekeeping systems do not have a mechanism of built in warnings, which means that management will not be notified whenever their colleagues are about to or already have exceeded the hours they’re supposed to work. This means more overtime, and overtime which is unplanned will drive up your costs because by law businesses are supposed to pay employees for it.
Manual Records Can Be Unreliable And Inaccurate
Manual timekeeping systems don’t provide reliable data regarding the number of hour’s employee’s work, which means that it is much harder for HR to make decisions which are informed regarding allocation. As a result, productivity is reduced, which causes the company to lose money.
As you can see, there are a number of significant downsides if you continue to use manual timekeeping systems. Studies have backed this up, with some showing that it costs roughly twenty percent of a yearly salary to replace an employee that makes below $50,000. Automated time management systems weed out all these inefficiencies, monitoring vacation, accruals and PTOs without the need to use the HR department. It empowers employees which makes them more productive, resulting in higher profitability.