Guest Blogger: Productivity Back on Track: 5 Time Tracking Productivity Benefits

As summer is coming to a close we have one more guest blogger for you with some great information on productivity.  I hope you enjoy this blog from Dean Mathews of OnTheClock.

As a payroll manager, tracking workplace productivity is more than a default part of your job description.

As the main custodian of data regarding the number of hours employees spend working, there’s a wealth of insight you can provide to unlock potential productivity improvements in your organization.

However, this is only possible if your workplace is equipped with a good time tracking system.

You might be wondering, “Well, we do use timesheets?” While there is nothing intrinsically wrong with this time tracking method, traditional timesheets are not as fool-proof as the sophisticated time tracking software available today.

In fact, research published in Harvard Business Review revealed that the majority of employees are inaccurately filling out their timesheets. This is costing the US economy $7.4 billion in lost productivity every day in the service sector alone.

Productivity is a shared interest between the company and its employees. As part of the payroll department, the following 5 benefits can be cited to rally your organization to use automated time tracking:

  1. Minimizes Multitasking

You might be staring at your screen right now confused.

Isn’t multitasking a productivity booster? So much so that it’s a skill a lot of businesses value.

Turns out that this is a big misconception.

Scientists have found that multitasking is a huge productivity downer, and can rob an employee up to 40% of his/her productive time. According to the research: “Psychologists who study what happens to cognition (mental processes) when people try to perform more than one task at a time have found that the mind and brain were not designed for heavy-duty multitasking. Psychologists tend to liken the job to choreography or air-traffic control, noting that in these operations, as in others, mental overload can result in catastrophe.”

With time tracking, employees must focus on the one task that is currently being tracked. This reduces what is called context switching and allows employees to focus their mental energy on the task at hand, producing better quality work.

It also allows project managers to see which employees engage in multitasking so the proper guidance and coaching can be provided to help them focus on one task at a time.

  1. Reduces Time On Non-Essential Tasks

Email is an essential business communication tool, but it is also a productivity blackhole.

An average office worker receives approximately 200 emails per day and spends 2.5 hours clearing out their inbox. Out of these 200 emails, 144 are not related to them and they were just CC-ed or BCC-ed in the conversation.

Email is just one of the non-essential tasks that is taking time away from more important projects. This does not even take into account the time spent on non-work related tasks such as social media browsing. What’s worse, as a payroll manager you know money is going down the drain paying employees for time spent on tasks that cannot be billed to your clients or customers.

With a well-established time tracking software, an organization can identify these productivity leaks and implement measures to reduce or eliminate them. This improves employee morale by reducing stress. At the same time, it saves the company money.

  1. Ensures Accurate Salary Computation

An unhappy employee is an unproductive employee. One of the major things that decreases morale for employees is not being accurately compensated.

This creates a cloud of distrust in the organization. Employees feel they are being cheated on and not getting the remuneration they deserve. This may result in a backlash in the form of low-quality work derailing important projects.

Of course, there are some unscrupulous businesses who intentionally shortchange their employees, but most payroll inaccuracies are a result of inaccurate time tracking.

Having a time tracking system in place eliminates inaccuracies in payroll because hours are easily and automatically tracked. There’s also a record, employees can refer to when payroll questions arise.

  1. Identifies Overworked Employees

All work and no play makes employees unproductive.

Putting in extended, and sometimes exhaustive, hours at work for a long period of time is a proven productivity killer. It can snowball into other problems such as habitual absences or tardiness, low employee morale, high attrition rates, and client/customer dissatisfaction.

The sad news is many managers do not catch these signs early enough, primarily due to poor time tracking practices.

Employees who are paid by the hour might not mind putting in the extra hours because they are getting paid for their billable hours. However, working overtime can cause serious issues with salaried, flat-rate employees.

While employee wellness is not the main responsibility of a payroll manager, a practical time tracking system can offer useful data to identify those employees in jeopardy of burning themselves out.

  1. Improves Project Planning Practices

Time tracking reveals discrepancies in time estimates between the projections during project planning and the actual hours spent during the project execution. The benefit this has on productivity is three-pronged.

First, it allows project managers to improve their forecasting for future similar projects.

Second, it prevents employee burnout as discussed above. There’s no need to put in extended hours to meet project deadlines if it’s not really necessary.

Lastly, it allows the organization to charge more appropriately via accurate accounting for the necessary man-hours to complete a project.

It’s Time to Be More Productive

Just a quick caveat. In order for any time tracking system to improve workplace productivity, making productivity a key priority should already be in the DNA of your organization’s culture. You should already know the core principles of good time management. Otherwise, you’re just going to waste time, tracking wasted time, right?

That said, time tracking has been proven time and again to increase productivity. Following the old business adage that you cannot manage and improve what you don’t track and measure, time tracking can open new heights of productivity that you never thought was possible. It also benefits your employees by minimizing multitasking and reducing time spent on non-essential tasks.

Indeed, it is time to put your workplace back on track.

Author Bio

Dean Mathews is the founder and CEO of OnTheClock, an online time clock app that helps over 8000 businesses all around the world track their employee time. Dean has over 20 years of experience designing and developing web-based business apps. He views software development as a form of art. If the artist creates a masterpiece, many peoples lives are touched and changed for the better. When he is not perfecting time tracking, Dean enjoys expanding his faith, spending time with family, friends and finding ways to make the world just a little better. You can find Dean on LinkedIn.

CA Adopts ABC Test for Independent Contractors

On Monday, April 30, the California Supreme Court issued a landmark [Dynamex Operations West v. Superior Ct., Cal. Sup. Ct., Dkt. No. S222732, 4/30/18] decision basically stating that the “ABC Test” is to be used when determining whether a worker is an employee or independent contractor for purposes of California wage orders. Previous to this latest decision the court case of S.G. Borello & Sons, Inc. v. Department of Industrial Relations, Cal. Sup. Ct., 769 P.2d 399, 3/23/89) was used to determine employee status. In that case the principal test of an employment relationship was whether the person to whom services were rendered has the right to control the manner and means of accomplishing the result desired. Under Dynamex, the Court embraced a standard that presumes all workers are employees instead of contractors and places the burden on classifying an independent contractor under the ABC test.

For a detailed analysis of this case and how you might have to adjust your hiring decisions, I will refer you to the Labor & Employment Law Blog posted by Timothy Kim for the law firm of Sheppard Mullin.

FLSA Video Training Has Arrived at DOL/WHD

The Wage and Hour Division (WHD) of the U.S. Department of Labor (DOL) is launching a new series of brief, plain-language videos to help employers understand their legal obligations when it comes to calculating overtime etc.  According the the WHD website these videos “strip away the legalese and provide employers with basic information…”  The topics provided so far are:

  • Coverage: Does the Fair Labor Standards Act (FLSA) apply to my business?
  • Minimum Wage: What minimum wage requirements apply to my business?
  • Deductions: Can I charge my employees for uniforms or other business expenses?
  • Hours Worked: Do I have to Pay for that time?
  • Overtime: When do I owe overtime compensation and how do I pay it correctly?

The videos are very well done and cover the rules quite nicely.  For example the overtime video does go into all the calculations needed for regular rate of pay.  They last an average of seven or eight minutes each. If you are looking for a good basic training on these topics listed check out the videos from WHD.

WHD Launches PAID Program

Paid Logo

The Wage and Hour Division (WHD) of the U.S. Department of Labor has launched a new nationwide pilot program, the Payroll Audit Independent Determination (PAID) program. According to the WHD, PAID facilitates resolution of potential overtime and minimum wage violations under the Fair Labor Standards Act (FLSA). The program’s primary objectives are to resolve such claims expeditiously and without litigation, to improve employers’ compliance with overtime and minimum wage obligations, and to ensure that more employees receive the back wages they are owed—faster.

Under the PAID program, employers are encouraged to conduct audits and, if they discover overtime or minimum wage violations, to self-report those violations. Employers may then work in good faith with WHD to correct their mistakes and to quickly provide 100% of the back wages due to their affected employees.

WHD is implementing this self-audit pilot program nationwide for approximately six months. At the end of the pilot period, WHD will evaluate the effectiveness of the pilot program, potential modifications to the program, and whether to make the program permanent.

However there are potential pitfalls to the new program.  The Blog Wage & Hour Insights, which I feature quite often in my blogs, has an excellent post by Staci Ketay Rotman, Bill Pokorny and Erin Fowler on this very subject that I encourage you to read to get a better understanding of this new program.

DOL Issues New Opinion Letters Including Lump Sums

The Federal Department of Labor (DOL) has been issuing a flurry of opinion letters recently.   But even more  amazing, is that one of the opinion letters actually deals with a subject long been a thorn in payroll’s side and one that some of us have waited years for a ruling.  The basic problem is whether or not lump sum payments such as bonuses are the same as normal wages under the law when it comes to withholding for garnishments.  You see many of the states do not think that lump sum payments fall under the Consumer Credit Protection Act or CCPA.  This is the Act, written in 1970, that sets the limits for what can be deducted from an employee’s pay for such garnishments as child support and creditor garnishments.  The DOL is actually in charge of enforcing the Act, but has always been unclear on their position on whether or not lump sum payments are covered under the Act.  This is especially true for child support, as employers may actually be required to report the pending lump sum payment and wait for instructions on withholding, usually for back child support owed to the state.  For example, according the the Office of Child Support Enforcement’s matrix on states and lump sums, Alabama requires 100% of all lump sums.  California states that it is subject to 50% unless the lump sum payment does “not involve earnings”. while Indiana follows the CCPA, So we have tried to look to the DOL to give a definition ruling on this and low and behold, they finally have.

In opinion letter CCPA2018-1NA the DOL has answered numerous questions on what constitutes earnings by discussing 18 different specific examples of common types of lump sum payments that an employer may issue to an employee.  These include commissions, discretionary and non discretionary bonuses, profit sharing, production bonuses, sign-on bonuses, relocation incentive payments and safety awards.

ALEC Wins Another State Over!

The American Legislative Exchange Council, or as it is commonly known ALEC, according to their website, is “America’s largest nonpartisan, voluntary membership organization of state legislatures dedicated to the principles of limited government”.  It’s current legislative agenda is to try to stop increases in the minimum wage and the mandatory sick leave movement as it sees it as having a negative effect on workers.  But in order to keep the minimum wage low or as ALEC describes it; “Maximizing the freedom of businesses and employees to negotiate their own wages” they not only have to convince state legislatures not to raise the minimum wage or provide mandated sick leave, but have to convince all local governments as well.  This is a tough job as there are thousands of local entities such as cities and counties that could decide to raise the minimum wage or enforce mandatory sick leave.  So ALEC takes the approach to tackle this from the head down by convincing state legislatures that they need to pass laws that prohibit any local entity from passing any type of minimum wage or benefit increase that does not equal the state level.  At this task they are making headway.  The latest state to buy into ALEC and bar local governments from passing a minimum wage or benefits ordinance is Wisconsin.

New legislation, A748,  prohibits counties, cities, and towns from enacting ordinances that: (1) establish or mandate local hour and overtime requirements, including scheduling employee work hours or shifts; and (2) require employers to provide employment benefits, including a retirement, pension, profit sharing, insurance, or leave benefit. The legislation does allow prospective employers to solicit salary information from previous employers and preempts counties, cities, and towns from prohibiting such solicitation.  The bill is effective as of March 30, 2018.

New Opinion Letter from DOL–NO Pay for FMLA Breaks

The Department of Labor is once again issuing opinion letters.  A flurry of letters were released on April 12th.  One letter addressed the issue of compensating for breaks that are covered under the Family and Medical Leave Act.  The Wage and Hour Insights blog authored by Staci Ketay Rotman and Bill Pokorny with FranczekRadelet covered this topic quite well so I decided to share it with my blog followers.  I hope you find it useful and insightful.

 

 

 

Jane Fonda is Not Wrong on Tip Regulations

As some of you may have seen on Facebook, a new video with Jane Fonda has been making the rounds. It concerns the latest Department of Labor proposed rules concerning employer treatment of tips.  Leaving the politics of Jane Fonda aside this is an important issue that needs to be understood.  A great source to understand this issue is the latest post from Wage & Hour Insights written by Bill Pokomy on December 8th.  I highly recommend you review his analysis of the proposed rule.

Using Fluctuating Workweek? Might Want to Think Again

If you are currently using the fluctuating workweek that is permitted under the Fair Labor Standard Acts (FLSA) you may want to review that decision.  The Fifth Circuit Court of Appeals has drawn some limits on that method.  Bill Pokorny has done a fantastic blog on discussing this recent court case. Check it out for the latest if you are currently using this type of workweek or just want to increase your current knowledge in this area.

Does Time and A Half Pay Count Towards Overtime?

When conducting my webinars on the FLSA requirements one area always seems confusing to attendees and that is the eight types of payments that can be excluded when calculating regular rate of pay.  The one found most often to be confusing to my attendees and maybe to you as well is the one that is for bona fide overtime premiums. Bill Pokorny has done an excellent blog post on this subject that I know you will find helpful on this topic. Please take the time to check it out if you offer this type of payment or to improve your general payroll knowledge.