What to Look for in a Time and Attendance System

What are time and attendance systems?

Time and attendance systems allow employees to clock in and out of work electronically via time clocks, internet-connected computers, mobile devices and phones. Some solutions even offer the ability to punch in and out via text messages and other communication methods, such as Slack. When an employee clocks in or out through the system, the data instantly transfers to software that can seamlessly import the information into your payroll solution for proper time tracking and employee payment.

However, these solutions do more than just track when employees come and go. They can also monitor mobile employees via geolocation and geofencing, manage paid time off (PTO), create employee schedules, provide detailed labor reports, and give business owners real-time data on who is working, who is not, who showed up late and who is nearing overtime.  

Time and attendance systems include self-service functionality that allows employees to handle many time-tracking tasks, such as reviewing the hours they’ve worked, their current and future schedules, and their PTO accruals. Intuitive built-in tools make it easy for workers, HR leaders and business owners to stay on top of attendance-related matters. [Learn how to create a PTO policy.]

Many of these systems come in both cloud-based and on-premises solutions. The on-premises versions are stored on servers within your business’s on-site IT infrastructure, while the cloud-based setups are housed by the program’s vendor. In either case, users access the features digitally.

Types of time and attendance systems

Given the breadth of functions that time and attendance systems offer, it should come as no surprise that there are various types. When comparing products, you’ll probably encounter the following options for time tracking:

• Timecard: The timecard option is basically the classic mechanical punch clock in digital form. When you install a timecard system, you’ll give your employees a timecard that closely resembles a credit card. Team members simply swipe their card to clock in and out. These cards and their corresponding device readers automate time tracking, but just as with physical time sheets, there’s nothing stopping employees from swiping each other’s cards to cover for absent or tardy co-workers.
• Proximity cards, badges and key fobs: Instead of making you swipe a card, these time-tracking options rely on devices that scan identifying cards, badges or key fobs within a certain distance. Many of these tools aren’t just for clocking in and out; they can also track your employees’ movements within your workplace by granting access to certain rooms, hallways and other areas.
• Biometric : With biometric time and attendance systems, you’ll know exactly who’s checking in and out of your office. These high-tech solutions use facial recognition, fingerprints, eye scanning and other biological identifiers that are unique to each person to ensure the person clocking in is actually the person working. Of course, you’ll pay more for this high-end setup, but with your extra spending comes nearly foolproof time and attendance tracking.

• Web-based login: If your employees work remotely, you’re probably wondering how any of the above solutions could fit your company’s needs. That’s why web-based login stations exist. You can implement virtual time and attendance systems that allow your staff to sign in to work from their laptops, personal computers or mobile devices no matter where they are. All they need is a web browser. Our review of QuickBooks Time outlines one example of how a time and attendance system can serve mobile workforces.
• Interactive voice response: Another solution for remote employees is an interactive voice response (IVR) tool, which allows remote or field employees to clock in and out via a phone call. The staffer dials the number and goes through an automated system, much like when customers call a company for support.

What to look for when choosing a time and attendance system

With so many time and attendance systems on the market, it can be difficult to know which one is right for your business. When you’re shopping for such a solution, look for these attributes:

• Flexible time-tracking options: Look for a system that allows employees to record their hours in multiple ways, such as through a computer, phone, tablet, time clock or text message. This ensures employees have a variety of options for clocking in, regardless of their work location.
• Accurate timekeeping: Good time and attendance systems ensure companies pay their employees for the actual time they work, not for the hours they’re scheduled to work. Before you purchase a system, read user reviews to get a sense of how reliable it is.
• Tracking for all attendance matters: Choose a system that takes care of all your time-related needs, not one that only allows employees to punch in and out. These functions include employee scheduling and PTO management functions. In addition, if your company charges clients based on time, you may want a system that offers job-tracking logs to record how long your employees work on specific projects.
• Mobile compatibility: Because many employees and managers today work outside the office, you’ll want a system that is compatible with mobile devices so it’s accessible from anywhere. The system should allow your remote workers to not only clock in and out virtually but also track their locations so you know they’re working where they’re supposed to be. Geotechnology can be extremely valuable for restricting where employees can clock in and out from and for recording the exact locations where they start and end their shifts.
• Ease of use: Search for a system that is easy to use, has an uncluttered interface and allows employee self-service. The program should not be hard to learn and certainly shouldn’t require hours of training.
• Integrations: Choose a system that integrates with the applications and software your business already uses, such as your HR and payroll programs.
• Proactive alerts: Some systems provide notifications when employees are nearing overtime or forget to clock in or out. This can be helpful for controlling expenses.
• Audit trail features: The ability to view original time sheet data, along with any changes made by a manager or supervisor, can be crucial in the event of an audit.

Pros and cons of time and attendance systems

Overall, business owners and their HR teams should find time and attendance systems beneficial, but here are some specific advantages and disadvantages to keep in mind.

Pros of time and attendance systems

These are some of the benefits of time and attendance systems:

• No manual timecards: The biggest benefit of modern time and attendance systems is that they eliminate the need for manual timecards. The time is collected electronically, with the hours worked and corresponding pay calculations made for you automatically.
• Less human error: Because time and attendance software is automated, it reduces the chance of human error in calculations of labor and job costing. The system also frees up the person who was responsible for your manual time and attendance tracking to work on other tasks. Additionally, with fewer errors comes a lower risk of noncompliance with labor laws and regulations.
• More efficient time tracking: Another positive is that these systems manage all of your time-related needs — including employee attendance, PTO and employee scheduling — in one program. This can result in cost savings and a boost to productivity, as employees won’t waste time toggling between different programs to ask for time off or look at their schedules, and managers won’t need to switch between applications.
• More accurate payroll processing: With time and attendance software, you don’t have to round the time your employees worked to more convenient numbers that work better with your payroll calculations and pay rules. Your software of choice will automate — and ensure the accuracy of — all of your payments.
• Extensive integrations: Most time and attendance systems integrate with many other human resources tools, so they work together to improve all of your workforce management tasks, not just your attendance-related processes.

Cons of time and attendance systems

These are the main drawbacks of time and attendance systems:

• Cost: The biggest drawback of time-tracking systems is that they are more expensive than the manual method where employees write down their hours each day or punch in and out on a paper timecard.
• Occasional errors: Even the best software programs may experience occasional glitches. There’s always a mild risk of errors in tracking or calculation when you use any software, including time and attendance systems, although the risk is lower than with manual calculations.

Costs of time and attendance systems

The cost structure of a time and attendance system depends on whether you choose a cloud-based or on-premises solution. Cloud-based systems have small recurring monthly costs, while on-premises systems typically have large one-time fees.

With on-premises systems, you pay all of your costs upfront. You can expect to pay several hundred to several thousand dollars for the software, user licenses for each employee, and installation. There are no monthly fees for the service thereafter. However, these one-time costs don’t typically cover any ongoing support or software updates.

For a cloud-based system, most vendors charge a per-employee fee that ranges from $1 to $10 per month. Some cloud services also have a base or minimum monthly fee. Additionally, providers may charge a one-time setup and implementation fee. Unlike with on-premises systems, however, all software upgrades and support are included in your monthly expenses.

One expense you might incur for either setup is a time clock. Many time and attendance systems work with a range of time and attendance time clocks, which can involve PINs, swipe or proximity badges, or biometrics such as fingerprint or facial scans. The complexity of the clock you select will determine the cost. Prices usually range from a couple hundred dollars for a basic clock to several thousand for a sophisticated biometric clock.

Best time and attendance systems

We researched and tested a wide variety of products to determine the best time and attendance systems. Here are five of the many great options available to your business:

• BambooHR: When you implement this software, you make it easy for your team members to track their hours spent working. Your staffers can submit their time sheets every week or after every pay period. Once the system has the time sheet data, it determines each employee’s pay and taxes, and you make the final sign-off before running payroll. Learn more in our full BambooHR review.
• Rippling: This time and attendance system excels at self-service. Your employees can quickly see their hours worked and ask for time off, and you can just as easily schedule your team’s shifts. The platform’s compliance features are also impressive; they automate your enforcement of meal break regulations and overtime laws. Explore this system via our in-depth Rippling review.
• Time Doctor: Fully automated time sheets are part and parcel of Time Doctor, as is the seamless syncing of these time sheets with your payroll software. You can also pull up daily activity data, including your team’s least-productive website usage and which employees are less productive than others. Read more about this time and attendance solution in our comprehensive Time Doctor review.
• When I Work: Your employees will automatically get clock-in and clock-out reminders when you implement When I Work. You can also restrict employee logins by time, location and channel. The program’s reports are especially great for making scheduling, hiring and budgeting decisions based on previous labor data. Discover what else this platform offers via our detailed When I Work review.
• TimeClock Plus: Biometric, browser-based, mobile and touchless time clocks are all available through TimeClock Plus. This time and attendance vendor also offers thermal sensors that detect when employees are attempting to clock in while sick. In addition, the software’s employee scheduling features are more advanced than those of many other platforms. Learn more in our extensive TimeClock Plus review.

Choosing the right time and attendance system

Although fancy-looking biometric time clocks might seem cool and exciting, the best time and attendance system isn’t always the most eye-catching one. Instead, you should choose the system that offers your business the highest value within your budget based on the research and product comparisons you’ve conducted. Keep the above information in mind when you’re evaluating different systems. Then, pursue free trials or product demos, and you’ll know intuitively which platform suits your needs best.

Max Freedman contributed to this article.