Timesheet: What It Is & How to Manage
Timesheets are documents that track worked hours and work progress of employees. They’re vital in workplaces where workers are paid by the hour.
Maintaining accurate timesheets presents several challenges for businesses. It’s time-consuming, error-prone, and requires a proper system.
To help you handle timesheets more effectively, in this post, we’ll discuss important points you need to know about timesheets.
What is a timesheet?
A timesheet is a paper or digital document that records employees’ worked hours during a certain period.
Timesheets are used for payroll in firms and businesses where workers are paid based on the hours they work. Project-based teams, remote companies, and freelancers also use timesheets to track the completion time of tasks and bill clients.
Why use timesheets?
The main purpose of timesheets is to help with calculating work hours, leaves, and accruals for processing payroll and paying workers.
For firms and freelancers that charge clients by the hour, timesheets record service hours and service details to bill clients and make invoices.
By tracking the completion time of tasks, worked hours, and leaves in timesheets, you can identify the strengths and weaknesses of employees.
Spotting which task or area suits employees more helps with assigning and delegating the right tasks to the right people, as well as promoting the right people to the right positions. Timesheets also reveal shortcomings, which urges you to find solutions for improvements or provide suitable training programs.
More accurate estimates
Past timesheets let you know how much time and resources you typically need for certain processes or projects. Based on those numbers, you can give clients estimates and communicate procedures more accurately. For example, if drafting a logo often takes 2 days, you can mention that when discussing the project timelines with clients.
Improving procedures and project management
Data from timesheets may reveal how you can distribute workload and resources for projects more reasonably. Concrete numbers may also tell whether a procedure or a project is efficient or not, so you can make suitable changes.
How to use timesheets
For shift work
For shift work that pays based on the hours worked, timesheets include the name, date, start and end time of each shift employees have worked.
Managers total the hours worked at the end of each pay period (weekly, bi-weekly, or monthly), verify if those hours are accurate, then multiply those hours by the pay rate to calculate employee wages.
Depending on each business, employees use different methods to record their timesheets. They can clock in and out using paper time cards, a biometric time clock, or timesheet software.
For businesses operating fixed hours such as 9 to 5, project-based firms, or freelancers, timesheets are used to track time spent on tasks. These timesheets log the name, date, start and end time of each task. These numbers aren’t only used for billing clients, but they also disclose insights into employees’ performance and project efficiency.
For varying rates
Not every hour of work is reimbursed at the same rate. Rates may vary depending on the difficulty and complexity of each task, the extra hours, or the different positions. You may need to create categories or tags to differentiate those rates, for example, regular rate, overtime rate, receptionist rate, barista rate, billable hours, etc.
How to manage timesheets effectively
Set timesheet policies
Transparent written policies help employers know exactly how to handle timesheets and help employees know exactly what to do with their timesheets.
Timesheet policies should include:
- How the company handles timesheets: papers, spreadsheets, or digital systems
- What to fill out in a timesheet
- When to submit a timesheet
- Timesheet reminders
- Rounding policy
- Overtime compensation
- Categories of work time
Similar to other policies, you should add timesheet policies to the company handbook or training materials.
If you’re just starting out with timesheets, don’t worry. Managing timesheets isn’t a set-and-done job. You can review timesheet policies periodically and remove/add rules over time.
Communicate with employees
Communication keeps people informed and information transparent. It’s necessary to talk about the importance of timesheets and communicate timesheet processes with employees right from the beginning of their employment.
The easiest way to communicate your timesheet process is to show video tutorials. If making videos requires more than what you have now, provide step-by-step written instructions instead, but try to keep them easy to understand.
As the company’s needs change over time, you may realize some information is no longer necessary to record. For any changes in the timesheet process, inform your team right away. You may want to remind employees a few times or set up automated reminders so your workforce can get used to the changes.
Consider timesheet automation
If you’re recording timesheets using paper or spreadsheets, consider using automation. Handling timesheets manually comes with human error and consumes more time than you realize.
Automation solutions for timesheets help generate timesheets automatically and accurately, so you and employees don’t have to enter data manually anymore. If your employees still need to submit timesheets by themselves, you can also set reminders via multiple channels (emails, text messages, push notifications) so they don’t forget.
Review and approve timesheets
Even when you use digital tools, a bunch of things can affect the accuracy of timesheets. It’s still possible that employees forget to record their hours or record hours inaccurately.
To avoid mistakes and time theft, a review and approval step is necessary before using the timesheets for calculating payroll. A business owner, manager, admin, or HR officer can be in charge of this step, but if you want to be careful, you can set up multi-levels of approval.
What’s the best tool for timesheet management?
Although it’s simple to get started using paper or spreadsheets, recording work time manually is time-consuming and error-prone.
A better alternative is to use a timesheet app like Camelo. Employees can view their shifts and clock in/out using a mobile app. Worked hours are recorded and converted into timesheets automatically. All there’s left to do is to quickly review the timesheets and export them for payroll. Try Camelo for free.