If you are still using paper timesheets, you are not alone.
There are still many companies relying on manual systems to record employee hours. QuickBooks reports that 38% of companies are using punch cards and paper timesheets to track their workforces. Yet, companies that haven’t switched to tracking employee time digitally with a time tracking app are secretly hurting their bottom line.
Keep reading to see how paper timesheets and punch clocks are costing your business time and money.
Expenses Caused by Paper Timesheets
Paper timesheets can cause expenses you may not realize. Here are three important costs you need to consider when looking at the case for continuing the current process or updating your systems to digital.
Of course, there are also the material expenses involved with paper timesheets. The cost of paper and ink might have been the first thing you considered when wondering how much you could save in the move to digital employee time tracking. The waste involved with timesheet paper is another expense you have to consider.
However, the material costs of paper timesheets are really just a fraction of what your business misses out on with a paper system.
The amount of time that goes into a manual paper system is astronomical. First, employees need to have the timesheet paper in their possession in order to fill it out — so distribution is needed. Then, someone has to collect the timesheets or make sure all cards are submitted in the right places. Businesses that take a hard-nosed approach to timesheet deadlines could lose good employees if they aren’t paid due to a lost timesheet.
Once all the timecards are collected, someone still has to manually review them and perform the calculations needed to run payroll. If you are doing any digital bookkeeping, you will also need to manually enter the information into your systems.
These busywork jobs are all easily replaced by a digital time tracking system, freeing employees to spend more of their time on productive tasks. You can’t afford to have employees working on extra tasks that could be covered by technology. Your skilled workers and company leaders should spend their time on important tasks and not data entry.
Missed Opportunities for Billing
Digital time tracking is even more important for a company that records employee time to bill their clients. None of the manual timesheet work is considered billable hours, meaning every minute spent tracking hours or logging payroll doesn’t count towards client- or customer-focused tasks.
Plus, with weekly paper reporting, it’s impossible to accurately account for employee hours on specific projects or accounts. According to Harvard Business Review, one firm found that the average employee lost around $50,000 per year because they weren’t tracking client hours sufficiently. Your workers might not be correctly timing their email response times to clients or other small tasks that could lead to a project costing more than what is billed to the client.
Lack of Efficiency
Efficiency is very important for businesses, and timesheets impact more than just the payroll process. When you use a paper system, you are adding extra steps to your process that go beyond cutting the check.
Reporting: A manual process means a sluggish system that makes it harder to access data. Unless you are taking additional steps to record data digitally, you won’t have access to important reporting that gives you a comprehensive view of your business.
Planning: If your data isn’t readily available, it’s much harder to plan future strategic moves for your company. You won’t be able to automatically assess projects or look for areas where you can improve your costs.
Compliance: You will run into legal issues if your paper records get lost or damaged without digital records to back them up. Relying on paper records could be costly if you ever need data for an audit or lawsuit.
How Paper Timesheets Increase Inaccuracies
Another thing that could be costing your business big time? Inaccuracies and errors in your payroll.
QuickBooks reports that 80% of the timesheets employees submit need to be corrected by US employers. An estimated $7.4 billion is lost every day because of timesheet errors.
When disputes do arise, it’s much more difficult to point to paper timesheets than digital records. Inaccuracies in the process may lead to a higher number of disputes over the amount of time worked or wages for tax withholdings.
Employees that don’t accurately track their information could also end up causing budgeting issues within the company. With more modern time tracking software, companies can predict project timelines and department budgets more precisely.
Why Modern Businesses are Eliminating the Paper Timesheet
The expense of wasted time, increased costs, lost financial opportunities, and squandered talent are the primary reasons many businesses are eliminating their paper system.
Time Tracker by eBillity provides modern businesses with a better solution for logging employee hours. With access to a minute-by-minute timer, weekly timesheet, or basic time card, you can have employees be as detailed as you want them to be. Some of the benefits of digital tracking with Time Tracker include:
- GPS capabilities for location tracking
- Clock kiosk for in-person stations
- Facial recognition capabilities to avoid time fraud
- Project tracking for productivity increase
- Employee scheduling with visibility of leave requests
- Live reporting on time, expenses, and invoicing
- Simple integrations with QuickBooks, Sage, ADP, Paypal, and more
- Convenient time tracking app for Android or iOS remote access
- Announcements, alerts, reminders, and screening capabilities
Time Tracker makes it possible to do more with less. You can spend less time and less effort to get more data and clarity. Increase your visibility while reducing the hours typically invested in manual tracking with paper timesheets.
You can get more accomplished with a system that automates a lot of the formatting and reporting. Plus, use this platform to keep your workforce in the know by posting important messages they will see while logging in for work.
Are you ready to learn more? Contact our team for a FREE demo today!