It's mandatory for non-exempt workers under the FLSA to record their time — both for legal reasons and so they are paid fairly. However, there is more debate on whether salaried employees should also keep timesheets if they are exempt. There are several advantages and disadvantages to having even exempt employees keep timesheets; the key is to weigh your options and find which way works best for you and your business.
There are several benefits to think about when deciding whether you want exempt employees to track time like hourly employees already do. Here are a few worth considering:
1. Check Work-Life Balance
Believe it or not, work-life balance is a real problem in the U.S., with studies finding that as much as 66% of American workers lack work-life balance, and 77% admit they've experienced burnout at their current jobs.
Checking timesheets can be a means of figuring out if an employee is working too many hours to the point where it may interfere with their home life. Employees who don't have a good work-life balance are often vulnerable to burnout, stress, and health problems if it persists over a long period of time.
If you can easily pinpoint signs of overworking and step in before it becomes a real problem, you can ensure your workforce is happy, healthy, and productive, saving you money in the long run.
It is also good for employees since they can prove if their workload expectations aren't realistic. If that's the case, then you both have their timesheet to go off of and discuss adjustments where necessary.
2. Increase Productivity
Aside from increasing employee productivity by reducing stress from overworking, structured time tracking can help some employees focus. If you see that an employee works long hours but isn't getting things done, you know they need an efficiency boost.
An efficiency boost can come in several forms — reducing stress, having more communication, access to more improved tools and data, and sometimes adding incentives can encourage more productivity. If a viable option, one study found that 86% of employees say they're most productive when they work from home.
In many cases, you can re-examine the employee's skills and behavioral styles to match whether they would be more happy and productive in another position. All employees aren't good at everything, so if you can find a problem sooner and resolve it, you can increase productivity.
3. Identify Under-performers
Timesheets can also be a good indicator for figure out which employees are working too few hours or not working hard enough. Under-performers can cost your company a significant amount of money, so it should be addressed immediately.
The Institute of Employment Studies says that when addressing poor performance, it's important it is done timely and early to avoid issues getting worse down the road. It is much easier to correct a small problem without firm action, but it could lead to being fired if the problem is too big.
It could also be a case where the employee isn't fully aware of their role and responsibilities. When you can easily identify who is underperforming, you can quickly address the issue, pinpoint what's holding the employee back from getting their job done, and move forward accordingly.
4. Justify Raises
When it comes time to discuss potential raises, employees can use timesheets to show how hard they work. Without a record-keeping of just how hard the employee works, it can be more difficult to compensate accordingly.
In many cases, this could infuriate employees who know they put in several hours with high productivity for insufficient pay. With the proof laid out in the timesheet, employees can prove their worth, and employers can be quick to provide a competitive salary to avoid losing good workers to rival companies that are willing to pay more.
5. Better Project Management
Timesheets can also be an easier way for cost tracking to determine how much is being spent on a particular project.
With a record of time spent on each task per employee, projects can be better managed and manipulated to fit budgets. In some cases, costs can be saved by delegating duties to employees who are more efficient in certain areas, which can be expressed in the time it took employees to finish a project in the past.
By identifying which tasks may be taking too much time, better project management can improve productivity and reduce costs and workload in areas where it is needed.
Likewise, there are a few notable disadvantages to having exempt employees track their time. They're not as significant but should still be considered in your decision-making process.
1. Takes time away from work
Productivity is crucial to every business's success, so it is also important you limit the number of tasks that can take time away from more important matters at work.
The time that could be spent doing work has to be spent filling in timesheets. This can become an issue if employees spend more time on their timesheets than necessary and start falling behind on their workloads.
It can also be an issue if timesheets get in the way of work-life balance for any of your workers. However, these are worse case scenarios and not always likely to happen.
2. May Demotivate Employees
Another worry employers may have concerning timesheets is that it may demotivate employees rather than encourage them to get more work done.
Employees generally don't like filling in timesheets, and doing so without a good reason may make them less satisfied with their jobs. While it is seemingly a small request, many employees may find the tedious work to be impeding on other matters that are more important and serve a higher purpose.
If this is the case, it will help significantly if you sit down with your exempt employees and discuss the reasons for considering timesheets and answer any questions they have. Being open for communication ensures employees clearly understand the intentions and 'good reasons' for filling in timesheets.
Weighing Your Options
When dealing with exempt employees, it can be difficult to decide whether to use time tracking. Depending largely on the importance of cost tracking and company culture, you may or may not want exempt employees tracking time. The key is to work with someone like Zamp HR, who has a team of experts that can help you weigh your options.