How improved technology can efficiently record time, produce invoices, and accurately pay employees.

by Stephen W. Carter, Scott Scheibel

Finance and accounting professionals are realizing many benefits from management’s decision to implement automated time and attendance solutions for salaried and part-time employees. These solutions help lower costs by reducing re-keying errors. They also eliminate fraud by removing the temptation to manipulate time captured through paper-based systems. And they improve the accuracy of bills submitted to clients for work done on their behalf.

Automated time collection solutions also offer an instant audit trail for producing detailed reports pertaining to a certain job, certain day, or even certain department, which is extremely helpful for evaluating performance or preparing budget estimates. Finally, automated solutions decrease the amount of time it takes to issue an invoice for employers who bill employee time to a third party.

There are a variety of automated solutions on the market today. Some operate as in-house systems while others are contracted through an outsource service provider. Employees have multiple options to access either solution and enter time through the Internet, interactive voice responses (IVR) telephone systems, automated time clocks, biometric devices that scan fingerprints or handprints, badge scanners, and personal digital assistants (PDAs), among others. Technology has made it so employees can enter data from anywhere, at any time. Data can be stored and retrieved easily to help management make key decisions at any time.

In today’s service-driven economy, businesses that rely on collecting time to generate invoices should no longer avoid automating the process to remain competitive.

AUTOMATION IN ACTION
In the past five years the staffing industry in particular has seen an increase in the number of organizations that have adopted automated time and attendance solutions. That’s because their business depends on how efficiently they collect time from employees on assignment, issue invoices, get paid, and pay their employees. Reducing the overhead involved in this process saves money.

Giving employees the tools to enter time into a system as it is accumulated on a job allows companies to instantly generate reports that clients can review and approve online without exchanging paper. If the client finds an error, it can quickly be corrected. An invoice can be generated and submitted into the billing cycle without missing a beat.

Not only are automated time solutions helping staffing companies do a better job generating invoices, but they are also strong management tools. As an employee enters his or her time on different jobs, all of the appropriate business rules automatically apply. So, if the billing rate for one job is different than another or a person’s time has extended to another shift, the system automatically calculates these changes and ensures they are reflected appropriately in the invoice.

PORTABILITY WITH PROMISE
Another benefit of automated time and attendance is portability. In the wake of the past summer’s hurricanes, employers that relied on automated business processes, including time and attendance, realized a number of benefits that exceeded their expectations.

For example, as soon as hurricane Rita was predicted to hit the Houston area, a local staffing company learned from its Gulf Coast neighbors’ experience with hurricane Katrina. Before the storm made landfall, the company quickly made provisions for the business to continue operating. All data collected from employees on assignment and other important data stored on the company’s server were transferred to a server in another part of the state. After ensuring the transfer was complete, business continued to operate as usual. All employees were paid on time, and invoices were issued because records could be retrieved.

Employers that have avoided adopting automation are now realizing that it is significantly easier to transport and retrieve information stored in a computer database than in numerous file cabinets. Still, there are many employers not ready to make the investment in in-house technology, and that is when an outsource service provider works best. Companies can realize the benefits of automation almost instantaneously because there is no installation of hardware or software.

STICK TO SAVINGS
Another benefit of automated time and attendance solutions is the ability to accurately capture and award paid time off (PTO). In the March 2005 issue of FAO Today, this column addressed how automating the PTO process gives the responsibility of keeping track of time back to the employees.

Automated time collection eliminates the burden of filling out paper forms, submitting them to managers for approval, and then handing the paper off to the HR/payroll department so they can record it in the books. Instead, PTO is captured and recorded for everyone in the same system and under the same rules.

This also helps address a hot topic in the time and attendance market: compliance. The Fair Labor Standards Act has radically changed overtime eligibility and heightened interest in getting complex work rules built into time and attendance systems. Today nearly every system can accommodate shift rules, overtime rules, and work-type rules as well as different locations, different types of employees, different goals or purposes, and more.

THE CHALLENGE OF CHANGE
Changing the way time and attendance is collected is not always an easy transition. Employees that already follow established rules are usually the least apprehensive about converting to an automated solution. With a new automated system, everyone operates by the same rules because the system doesn’t allow for exceptions.

It’s important to take employee satisfaction into account when introducing an automated time and attendance solution. The last thing you want is for employees to think it’s a tool for policing the workforce. Instead, it must be made clear that it isan opportunity for everyone to play a role in checking their hours and their pay in real time.

As more and more employers recognize the variety of benefits that can be gained from implementing automated time and attendance solutions, they are becoming more commonplace.