Step by Step Guide For Developing an Employee Time and Attendance Management System

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Regardless of the size of your organization, maintaining accurate employee attendance records is crucial- and not only because it is the law! The costs associated with labor are generally the largest expense incurred by a business, so workforce management is more than about compliance; it is also about protecting your business’ bottom line. However, designing/selecting the right type of attendance management system for your organization can be daunting…and it is important. If you select the wrong system for your organization, you could end up spending more time and resources than you would normally need to.

On that note, we have created a step by step guide for developing an employee time and attendance management system.

Types of Attendance Management Systems

• Timesheet

• Time Clock

• Automated Attendance System

– Badge Reader (swipe, proximity, etc.)

– Biometric (Fingerprint, Hand Reader)

• Software/Internet/Mobile App Options

Step 1. How many employees do you need to manage?

Up to 5 Employees

If your organization has fewer than 5 employees, you are looking at two options for an attendance management system: a time sheet or a time clock with time cards. The lure of the time sheet is one of cost. All you have to do is create a time sheet and you are good to go. However, while time sheets do satisfy the government’s requirement of documenting the hours of employees, they are easy to falsify or to pad time. A basic employee time clock does discourage falsifying time records and is particularly effective in smaller organizations.

Up to 25 Employees

If you have a small business with fewer than 25 employees, a time clock will (most likely) be a good fit for your organization. An automated attendance system might be a better option though. As a general rule, if you are not spending more than 1-2 hours per pay period on attendance management, a time clock is an acceptable time recording method for your organization. However, if you are spending any more time than 1-2 hours per pay period, you will want to look into an automated attendance system.

Over 25 Employees

For any business with more than 25 employees, we recommend using an automated attendance system. The systems available today are robust, comprehensive and cost efficient.

Please note that all questions after step one are to determine the right automated attendance system for your company.

Step 2. What industry is your business in?

While this question may seem unimportant or as a marketing ploy to gain demographic information from you, this information is indeed important in determining the right type of attendance management system for your company. Each industry has certain characteristics. Some industries need credentials; others deal with chemicals so fingerprints are all but non-existent. A general rule for determining the right system in step 2 is detailed below.

Badge Readers

Badge readers come in handy in industries that require credentials as they can double as both a credential and attendance management tool. The media and entertainment industry is a good example. Badge readers also work well with access control systems in companies with heightened security. There are several variations badge swipe, barcode scanners and proximity attendance systems.

Fingerprint Reader

Fingerprint readers are most commonly used in retail and business environments. Fingerprint readers are excellent in industries that require heightened security or where buddy punching is a common and prevalent problem. They can also double as access control systems where necessary.

Hand Reader

Hand readers represent the other biometric automated attendance option on the market. Hand readers measure and analyze the overall structure, shape and proportions of the hand (i.e. width, length and thickness of hand) and manages to still maintain accuracy when hands are dirty or injured. Hand reader systems are the most widely used scanning devices and can also work as an access control terminal as well. Hand readers are most commonly used in industries where buddy punching is prevalent and where relying on a fingerprint is not the best option. Industries include: manufacturing, food processing, health care and restaurant chains. Arguably, hand readers are the best biometric option on the market, however, their chief barrier to the small business is in their pricing as they are also among the most expensive terminal options on the market.

Step 3. What does your attendance system need to be able to do?

HR Functions. Aside from the basics of recording/setting punches, meal breaks and breaks, a good software programs should be able to cover basic HR functions. This broad category covers the essential HR functions including: tracking employee attendance, applying rounding rules, calculating overtime and calculating employee time and wages. It is what a software has beyond these basic functions is what determines whether or not it can tout heavy weight status. The following are some of the features to look for in a comprehensive attendance management software:

Payment Policies. Do you work in an industry where your employees are paid differently based on the type of job they are doing? Do you need to define holiday, overtime and exception rules differently? Are there payment policies/practices specific to your industry?

Scheduling and Shifts. Does your company have flexible shifts or floating shifts?

Reporting. What types of reports does your business need? What type of information do you need available instantly? What can you live without?

Payroll Export. This is a big one. Who does your payroll? Your software needs to be compatible and fully supported.

Polling. Who is in? What are they doing? A good software program should allow you to do this and some hardware terminals will allow you to do this at the terminal itself (for example, HandPunch).

Benefit Accruals. If your organization has a policy for vacation or sick time, your software should be able to apply that policy to your attendance management.

Database Backup and Restore. A few of us know the pain and agony of losing your data, but we all fear it. Your software should have a database backup and restore option. If it doesn’t, don’t buy it.

In sum, what you need is determined quite literally by what you need and software is where you will get the full potential and efficiency of an attendance management system. Also, while this guide does make the attempt at helping you determine the right solution for your organization, getting expert advice from a time and attendance professional is always recommended.

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