Workers tracked over 944.8 million hours in TSheets in 2019.* That’s over 3.4 trillion seconds! Consider our minds blown.
As we leap into the new year, new research and a new law are proving that tracking time is more important than ever. Small business owners everywhere will need to consider how they will keep up.
Our suggestion? If you’re going to create a New Year’s resolution for your business, it should be to improve your employee time tracking practices. And we’ll tell you why.
Tracking time benefits everyone
Whether you have one employee or many, tracking time is critical for businesses of all sizes. There are many reasons why, but let’s start with the benefits to employees. Accurate time tracking can help you pay salaried and hourly employees fairly. 65% of hourly, and 41% of salaried employees track time to ensure accurate paychecks, according to QuickBooks’ 2019 State of Time Tracking Report.
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Meanwhile, tracking time can prevent employee wage theft and protect you from time theft and buddy punching. Unfortunately, 15% of employers say their workers don’t track hours at all. Another 12% are unsure. The report also revealed that 1 in 5 employees said buddy punching is “widely accepted” at their work. 12% who admit to buddy punching said they do it to help co-workers earn more overtime.
Employers are more likely to overpay than underpay employees. So not tracking time can cost you, and those costs add up. As the State of Time Tracking Report proves, accurately tracking time benefits everyone in a business.
New labor law makes 1 million workers eligible for overtime
The Department of Labor’s (DOL) new overtime rule went into effect on January 1, 2020. The rule increased the overtime salary threshold from $23,660 annually ($455 per week) to $35,568 ($684 per week). This change makes 1.3 million more American workers eligible for overtime pay. According to some experts, it’s a long-overdue change.
The new rule also:
- Raises the annual compensation for “highly compensated employees” from $100,000 to $107,432.
- Allows employers to use commissions, annual or nondiscretionary bonuses, and other incentive payments to satisfy up to 10% of an employee’s standard salary level.
- Revises salary levels for some workers in U.S. territories and the motion picture industry.
Business owners will need to review their employees’ pay and positions to ensure compliance with the threshold increase. On top of that, tracking time will become vital for compliance. Hourly and salaried employees should track regular and overtime hours to get paid. And without proper timesheet records, employers may be subject to expensive fines.
Only 55% of employers said they were aware of this new overtime rule. But being unaware of a law’s change isn’t a viable defense in the eyes of the DOL. Among those who were aware of the change, 61% of employers and 77% of employees said they support it.
In any case, consult an HR specialist or employment law expert to ensure your business is compliant.
Hindsight’s always 2020
For businesses and American workers, tracking time is more vital than ever. Besides ensuring fair payment, 1.3 million more employees are within the new overtime threshold. Before the new rule, 1 in 3 employers reported experiencing an overtime dispute or prosecution. And unless business owners keep up with the new labor laws, that number may increase dramatically.
If your 2020 New Year’s resolution is to start tracking time or improve your time tracking policies, you’re off to a good start. It’s better to be prepared than it is to be caught by surprise down the road.
*Based on timesheets created from over 100,000 TSheets customers, excluding paid time off and breaks, between January 1, 2019, and December 24, 2019.
This article originally appeared on TSheets and was syndicated by MediaFeed.org.
Featured Image Credit: DepositPhotos.com.