Time Tracking

Timesheets And Inaccurate Reporting: The Real Payroll Problem

Last update on:
September 7, 2021 3:53 PM
Published on:

Compiling payroll can be a hectic process, regardless of the size of your company. Using paper timesheets has in the past proven to be time-consuming and far from perfect. The task of reading everyone’s handwritten timesheets can easily cause errors.

It’s estimated that an average business loses up to 4% payroll, at a minimum, on clerical errors. “What number is that?”, “Whose name is this?” these are some of the common questions that accompany a paper system. With paper time cards, payroll teams are under pressure to complete payroll before the due date and this may result in further errors or late payroll.

Manual clock-in systems encourage time theft and exaggerated overtime by employees. Errors often go unnoticed leading to wrong payroll recording and losses to the company. Paper timesheets promote buddy punching, and this happens far more often than most employers are aware.

Paper systems have no employee verification, one employee can enter someone else’s time, and it will go unnoticed. At its worst, supervisors or managers are creating a ghost payroll, where they make up hours for non-existent workers.

Handwritten Timesheets & How to Solve For Human Error

Finishing and submitting time cards seems like a simple thing right? However, employee timesheet management poses a tough challenge for businesses both small and big. Timesheets are essential aspects of every organization because:

  • * They help the organization determine whether their resources are allocated accordingly, and the outcomes yielded.
  • * They help the organization provide a detailed report to show to their clients and issue payment to employees.

Paper timesheets are not reliable, they are at times hard to read, and they are easily damaged or lost. Paper-based timesheets rely on manual labor to keep them updated and correct. This has in the past proven to be time-consuming, tiresome, and costly. Some workers have lousy handwriting resulting in errors and inaccuracy.

You can avoid all these issues by adopting digital timesheets. The payroll team will no longer have to deal with questions such as “How many vacation days do I have and how many days do I have left?” from workers. With digital timesheets, employees will have access to their own hours on their phone.

Digital timesheets help employers track their workers hours easily and accurately. You don’t have to follow up with staff members about their timesheets manually. The app does the dirty work for you by automatically sending reminders to employees to submit their timesheets. According to research, digital timesheets saves your business nearly 5% (or more) on payroll spillage. Crew members can punch in or out quickly via their smartphones.

Time Cards & Theft Statistics from the American Payroll Association

Time theft is when an employee gets paid for hours they haven’t actually worked. When employees clock in but are not on the job, they are stealing the company’s time. Time theft is hard to detect especially with manual paper timesheets, and this costs the employer due to low productivity and inflated payroll.

Buddy punching may not seem like an obvious issue, but 17% of workers have admitted punching in or out for co-workers. Statistics from the American Payroll Association estimates that businesses lose more than $400 billion annually due to lost productivity.

Time theft here and there result in enormous losses for companies in the long run. Buddy punching alone causes businesses 75% in payroll losses, and they average to 2.1% of gross payroll. According to statistics, the average employee steals 450 minutes per week (more than 4 hours!).

How Smart Businesses Are Combating Time Theft with Digital Time Sheets

Accountability is crucial when it comes to hours worked by employees, attendance, and schedules. Unfortunately tracking employee hours, accountability, and attendance can be a robust process. Digital time tracking has revolutionized the way employers monitor and manage their employees.

Digital time tracking has employee verification which discourages buddy punching. Workers clock in and out via their smartphones resulting to accurate hours recorded on their timesheets.

Paper-based timesheets are prone to errors, and they are not reliable. Take the initiative today and adopt digital time tracking to curb time theft and losses experienced in payroll.


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