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How Integrating Payroll and Time and Attendance Can Help Grow Your Business

Human Resources

Integrating your time and attendance system with your payroll software can have a major impact on your company's budget and level of employee management. For many entrepreneurs, managing employees' time and attendance is one of the biggest and most time-consuming headaches related to owning a small business. Employers' concerns in this area are mirrored in the findings of the 2018 Paychex Pulse of HR Survey. Tracking employees' time and keeping up with regulations were among the most-cited HR challenges according to survey respondents.

The shortcomings of manual time tracking

When the time and attendance process relies on manual entry and functions separately from payroll, the potential for errors and inaccuracies can be high.

For instance, employees who use manual and paper-based time and attendance systems may forget to complete their time sheets by the deadline, and then may make errors trying to catch up later on. They might not recall precisely what time they came to work, the length of their lunch breaks, and the exact time they departed in the evening.

This opens the door to businesses either not paying employees enough for time they've worked — a frequent complaint among workers — or overpaying them. Issues revolving around payroll (such as not being properly paid) can negatively impact employee morale, which in turn can affect productivity in the workplace.

Inefficiencies, unnecessary expenditures, and rising levels of employee discontent are all compelling reasons to pursue an integrated payroll approach to time and attendance.

Benefits of an automated time and attendance system

Electronic time-clocks and sophisticated software assume the tasks of collecting, tracking, and managing employee work hours and pay. Data is analyzed on a real-time basis, enabling managers with the opportunity to review and approve employee time for payroll processing with greater efficiency and accuracy.

Automated systems can help track employee time in several ways, including:

  • Reading a magnetic stripe or bar code on an employee's company card.
  • Reading an employee's fingerprints through the use of biometric terminals (eliminating the problems of lost badges or of one employee clocking in and out for another).
  • Reading times logged in and out at the employee's personal computer.

Additional core benefits of an automated time and attendance system can include:

Managing an efficient workforce: Automated time and attendance solutions give managers the ability to match scheduling to workload projections. This can help increase efficiencies, meet production goals, and manage costs. An analytics dashboard also allows managers to review data over time, watch for opportunities to be more efficient, and head off problems that can derail productivity.

Less paperwork: A significant reduction in paperwork is another immediate benefit to employers and their workforce. With an integrated payroll system, there's no more printing of paper time sheets or data entry into the payroll system.

Freeing managers and HR staff from administrative tasks: Relieving supervisors and HR staff of time-consuming administrative tasks is another big plus for employers. Information from tax forms, benefits data, and employee reviews only needs to be entered one time and into a single interface. In this way, your HR staff can turn their attention to broader and more strategic activities, including new and more efficient ways to recruit and retain valued employees.

Protecting against claims of non-compliance: An automated time and attendance system can help your company defend itself against claims of non-compliance with wage and hour laws. For example, depending on applicable federal, state, and local laws and regulations, staff members may have a maximum number of hours they are allowed to work per shift, or per week.

Time and attendance software can help ensure compliance by allowing managers to set notifications and to be immediately alerted of schedule conflicts. In addition, it's possible to manage overtime to help ensure your business remains within government, union, and company guidelines regarding both scheduling and compensation.

Archived time records and policies (and more consistent data collection overall) can help make complying with various wage and hour laws and regulations much less onerous for employers. In the event your small business is audited for allegations of wage and hour violations, the data accuracy generated through an integrated payroll system may help facilitate the auditing process.

Improving employee satisfaction: Scheduling and handling time-off requests are important elements in maintaining a satisfied workforce. When employee satisfaction increases, issues like turnover may dramatically decrease. Companies that offer staff enough hours to maximize their incomes, while being flexible enough to accommodate vacation requests or scheduling needs, generally foster a desired employee experience. With automated systems, it's possible to quickly review, approve, or address absence requests and manage planned absences to minimize their effect on your company.

When payroll and HR information are available together through a single interface, self-service features are much more effective. Employees can log into the system and quickly access information about payroll, available vacation and sick time, current tax deductions, and benefits. The ability to access this information allows employees to answer basic questions themselves, which can boost employee satisfaction and decrease the amount of time that management and HR spends resolving simple issues.

An integrated interface can also make it easier for HR staff and managers to access employee information on demand, saving time and enabling management to make more informed decisions.

Boosting data access and security

Streamlining data entry can also help increase the accuracy of your payroll and HR information across platforms because fewer people are entering information — which may help prevent costly errors and save the time and money it would take to correct them.

An integrated interface can also help improve data security, since payroll and HR benefits systems contain highly sensitive company and employee data, from salary information to social security numbers. By integrating these systems into a highly secure HR platform, you can help reduce the chance of data breaches.

Don't let outdated or manual time tracking processes drag down your productivity or bottom line. Switch to an automated payroll time and attendance system with a powerful online timekeeping solution fully integrated with payroll.

This website contains articles posted for informational and educational value. Paychex is not responsible for information contained within any of these materials. Any opinions expressed within materials are not necessarily the opinion of, or supported by, Paychex. The information in these materials should not be considered legal or accounting advice, and it should not substitute for legal, accounting, and other professional advice where the facts and circumstances warrant.