Organizations, ranging from Small and Medium Businesses (SMBs) to large enterprises, need to track their employee’s time spent across different tasks and activities, irrespective of whether they work from office or remotely. This is where timesheets come into the picture. A typical timesheet is a document that shows how many hours employees worked and on which tasks.
Though the basic purpose of a timesheet is to track employees’ work time, it also helps process payroll of employees based on the number of hours worked.
This guide elaborates on what a timesheet is, its various types and applications.
What Is a Timesheet?
A timesheet records the work hours of employees during a day/week/month. This work hour data is used by supervisors and HR to process payroll for their employees.
Simply put, timesheets serve as a database of employees’ time entries based on which they are paid. This timesheet also acts as proof of work and time usage by employees at the workplace.
A typical timesheet consists of start, end and break times for employees to fill in. However, the timesheet can be customized to tailor the specific needs by adding additional fields, such as project name, project code, client name, time off, date, status, etc.
Brief History of Timesheets
Timesheets have been around since the 19th century when factory owners used these to monitor employees’ work hours. However, the origins of the timesheet date back to 1772 BC. The ancient timesheets served as a record of time that workers took to complete their jobs and this was useful for wage distribution purposes.
It’s widely believed that inventor Williard Bundy created the first automatic mechanical time clock in the 1800s, the patent for which was then granted by the U.S. Patent Office and Trademark Office. In 1888, Dr. Alexander Dey created another device known as the “dial recorder”.
Though the inventions happened on different continents, they were both successful. Even today, most manufacturing plants, businesses and organizations use a time card and black box system for their employees, which resembles Bundy’s invention for tracking work time.
Significance of Timesheets
- Timesheets serve as a database for employers to pay employees fairly based on their time entries.
- Managers can identify roadblocks with the help of timesheets by reviewing the tasks that take longer than others.
- According to a survey by consulting firm Korn Ferry, workers spend more than two hours a day doing things that are not considered work. But timesheets can show how employees spend their time and how much time they devote to which task when billing the client.
- With the help of the timesheets, employers can ascertain the employee’s efficiency and productivity by thoroughly analyzing the time used for each task.
- Supervisors/managers can optimize the work schedule for maximum productivity based on the time usage across different activities.
- A timesheet provides transparency so that supervisors have insights into how many hours the employees worked on tasks/projects, their bandwidth, their availability, tasks that required more time, the number of time offs they availed, etc.
- Projects or tasks in the timesheet that are consuming a great deal of employees’ time and are not serving significant value can be categorized as low-priority tasks. Equipped with this data, managers can do the cost-cutting on unprofitable projects and direct funds and time to worthwhile projects.
How Does a Timesheet Work?
Generally, companies ask their employees to fill in the timesheet on a daily/weekly/monthly basis to document their work time data, like how much time they spend on which activities.
Employees fill in their start time, end time, break time, and vacation/sick time for every workday. The total work hours for each day are calculated according to start and end times entered after deducting break and vacation times. Then, managers or supervisors approve the timesheet if it’s filled in correctly or reject it if the entries have errors to validate it.
Once approved, the manager forwards the timesheet to the HR department or stores it in another system for future reference.
In most organizations, the managers/supervisors/HR explain-
- what system or tool they use for time tracking
- how employees should fill in the timesheets
- when employees should fill in the timesheet (daily/weekly/semi-monthly/monthly)
- when employees should submit it for approval
Timesheets are very beneficial for service-based organizations as they need to ensure how resources are utilizing their time at the workplace. However, different organizations use different time-tracking systems/tools as per their preferences. Some use spreadsheets like Excel, while others have switched to advanced timesheet software or time-tracking software to track employees’ real-time work data.
Advantages of Timesheets
Helps Streamline Work and Projects
When an employer has complete visibility into employee’s work, time usage, bandwidth, and task details, it becomes easy to find out whether –
- there’s any labor wastage
- any projects are causing cost overruns
- employees are investing more time on low-priority or insignificant tasks
- employees have taken up any responsibility that they shouldn’t undertake
In these ways timesheets provide a holistic view of the employee’s workflow and workload, based on which employers can cut down unnecessary tasks or make informed decisions to increase productivity and optimize workflow.
Helps in Accurate Billing
A timesheet helps calculate accurate invoices for clients. Based on the number of hours spent by resources on any project, the client for that project can be billed. In fact, nowadays, the timesheet software tools have robust reporting functionality. This report can be shared with a client, through which they can know how much time was spent on which tasks and which part of the project had a roadblock.
Asking employees to track their own time makes them accountable for their work. When employees are held liable for their time and asked to update their task details daily, they feel responsible for accomplishing their work on time. Also, when they fill in their timesheets, they are less likely to procrastinate and slack off their work.
Preventing Cost Overruns
Tracking the accurate time and cost of any project in the project timesheet helps in estimating the cost, and time for future projects.
For instance, if the nature of tasks in the next project is similar to the project that you’ve worked on previously, then the timesheet of that past project can work as a cornerstone for your next project as it’ll give you an estimate of resources, time, and cost. Thus, if you have a project timesheet with accurate records, it serves as a reference for future projects and helps cut down unnecessary costs.
Efficient Project Management
Some timesheets, such as employee project timesheets, are designed to track project progress and status based on how tasks have been allocated to different employees.
By analyzing time usage by employees on different tasks, the employer/manager can figure out if an employee is better in a certain area or skill and can utilize them accordingly in different parts of the projects.
This timesheet also helps managers discern any areas causing bottlenecks by analyzing which part of the project is taking too long to complete.
Managers can have an insight into the project’s progress, anticipated delays, resource allocation, and respective bandwidth. Thus, they’ll be able to make prudent decisions for maximum profitability.
Types of Timesheets
Most organizations use the daily/weekly/bi-weekly/monthly timesheet for employees to process payrolls or bills to the client. There are several types of timesheets designed for employees that employers can choose as per their preferences.
For example, if any organization processes payroll monthly, a monthly timesheet is a good choice. However, it’s likely that employees may not be able to remember all the tasks they worked on after some time. That’s why some employers go for weekly timesheets for their employees. Similarly, if employers need to track employees’ daily work hours, a daily timesheet can do the trick. Usually, there are five types of timesheets popularly used by organizations.
- Daily Timesheets
- Weekly Timesheets
- Biweekly Timesheets
- Monthly Timesheets
- Semi-monthly Timesheets
Applications of Timesheets
Timesheets are best known for tracking work hours, time offs, and breaks of the individual employee on a weekly/bi-weekly/monthly basis. Based on the number of hours worked, employers can calculate an employee’s wage.
By tracking employees’ time on various projects, businesses can accurately bill clients based on the number of hours worked on each project. This time billing is most beneficial for organizations that bill their clients by the hours. Timesheets provide transparency to clients and enable them to see how much time was dedicated by resources to their project and serve as proof of how accurate the billing is.
Moreover, most freelancers charge their clients by the hours, so it’s imperative that they track the total hours worked to receive accurate pay. Timesheets can help freelancers track their work hours accurately and allow them to share their work records with clients as proof of work.
Labor Law Compliance
Inaccurate time data can land you in hot water over non-compliance issues.
To stay compliant with the FLSA rules and regulations, organizations must have a track of employee’s work hours, overtime hours, and leaves taken. Timesheets help businesses stay compliant with local labor laws by tracking employees’ work hours, thus avoiding expensive litigations.
It has been observed that some resources work till late hours to pick up the slack while others don’t pull their weight. Timesheets give visibility into employees’ workload and their bandwidth.
With the help of timesheets, managers can easily ascertain if any employee has an extra workload and can delegate some tasks to others with less bandwidth. This way, employers can distribute the workload equally and prevent them from burnout.
Improving Employee Productivity
With the help of a timesheet, supervisors can easily ascertain if any employee is taking more time to complete certain tasks or struggling to complete their work. If some employees are taking more time than usual to complete specific tasks, then employers can provide them with some training or guidance.
On the other hand, the timesheet helps identify those employees who could be going the extra mile or completing their tasks well ahead of time. Their efforts can be recognized by giving them bonus amounts, or any non-cash reward like a shout-out, time off in lieu of extra hours etc.
Digital Timesheets vs. Paper Timesheets
Storage & Access
Digital timesheets greatly outweigh paper timesheets, as cloud-based timesheets are less prone to data loss. In the case of paper timesheets, there are chances that the timesheets may get misplaced or stored in the wrong folder, which can be difficult to retrieve at the time of need.
In fact, as per a survey, information workers waste around 28 days a year searching for printed documents. However, in the case of digital timesheets, the data is saved in the cloud and can be instantly accessed whenever and wherever required.
Level of Accuracy
Paper-based timesheets are prone to errors and buddy punching that may cost the company a great deal of money. When doing it manually, employees can make errors while inputting data in the timecard or timesheet. However, digital timesheets are much more efficient as data is filled automatically and generates an error if not filled appropriately.
In fact, organizations can leverage time tracking software with a digital fingerprint scanner, face recognition time clock, or other such kind of validation feature to prevent buddy punching.
Mode of Data Entry
One of the greatest downsides of paper timesheets is that these need to be filled manually, which is a tedious and time-consuming process. But digital timesheets can save you a lot of time and energy.
Especially when you leverage AI-powered timesheets, such as ZeroTime™ from Replicon, it eliminates the need to fill time data, as it automatically captures work time data from various work apps.
Once employees fill in the paper timesheets, someone needs to supervise them to see if everyone has filled in their timesheets or if they are filled properly. However, in the case of digital timesheets, they allow supervisors to set the validation rules for timesheet submission.
This way, if someone hasn’t input time properly, it will generate an error message. Besides, if someone forgets to fill and submit their timesheets, they automatically get a reminder notification.
Work time data in paper timesheets must be processed manually into different systems for payroll or billing purposes, which is a major drawback. However, in the case of digital timesheets, all the data is stored in one central location that can be accessed by everyone from different departments with a few clicks.
Thus, the time spent on administration work gets minimized and can be utilized for more productive work.
Paper timesheets can be easily tampered with and are also prone to buddy punching. On the other hand, digital timesheets are securely stored in the cloud, and employees can’t tamper with the data.
Though digital timesheets have emerged as a better alternative to paper timesheets, many organizations still stick to the classic paper timesheets as they are easy to use, cost-effective, and easy to manage for small workforces.
Timesheets have been the most popular way to track employees’ work time data since ancient times. However, with the advent of technology, timesheet software has made the timekeeping process more streamlined and hassle-free.
There are several timesheet software available in the market, but Replicon, powered by ZeroTime™, is renowned for its AI-powered timesheets. In fact, these AI-powered timesheets can automatically capture the accurate and contextual work time data of employees from more than 100 apps such as Jira, Slack, and Zoom. This liberates employees from the hassle of manual time entry.
In addition, Replicon allows employers to capture employees’ work time data, bill the client, and process payroll with 100% accuracy.
So, if you’re looking for an intuitive timesheet software that serves all these functionalities and encourages 100% user adoption, then try our free demo now!