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Updated Feb 13, 2024

What to Look for in a Time and Attendance System

Time and attendance systems do far more than track employees. Here's why and how to get one.

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Chad Brooks, Business Ownership Insider and Managing Editor
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This guide was reviewed by a Business News Daily editor to ensure it provides comprehensive and accurate information to aid your buying decision.

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A time and attendance system can benefit your business in numerous ways, especially when it comes to employee scheduling and payroll. With so many product choices, though, it can be challenging to determine which solution will best fit your needs. If you’re looking for a time and attendance system, here’s everything you need to know about what time and attendance systems are, what they offer and how to choose one. We also provide our picks for the top time-tracking programs on the market.

Editor’s note: Looking for information on time and attendance systems? Use the questionnaire below, and our vendor partners will contact you to provide you with the information you need:

What are time and attendance systems?

Time and attendance systems allow employees to clock in and out of work electronically via time clocks, internet-connected computers, mobile devices and phones. Some solutions even offer the ability to punch in and out via text messages and other communication methods, such as Slack. When an employee clocks in or out through the system, the data instantly transfers to software that can seamlessly import the information into your payroll solution for proper time tracking and employee payment.

However, these solutions do more than just track when employees come and go. They can also monitor mobile employees via geolocation and geofencing, manage paid time off (PTO), create employee schedules, provide detailed labor reports, and give business owners real-time data on who is working, who is not, who showed up late and who is nearing overtime.  

Key TakeawayKey takeaway
Time and attendance systems do more than track employees’ hours. You can also use them for scheduling, time-off management, labor reporting and other HR functions.

Time and attendance systems include self-service functionality that allows employees to handle many time-tracking tasks, such as reviewing the hours they’ve worked, their current and future schedules, and their PTO accruals. Intuitive built-in tools make it easy for workers, HR leaders and business owners to stay on top of attendance-related matters. [Learn how to create a PTO policy.]

Many of these systems come in both cloud-based and on-premises solutions. The on-premises versions are stored on servers within your business’s on-site IT infrastructure, while the cloud-based setups are housed by the program’s vendor. In either case, users access the features digitally.

Types of time and attendance systems

Given the breadth of functions that time and attendance systems offer, it should come as no surprise that there are various types. When comparing products, you’ll probably encounter the following options for time tracking:

  • Timecard: The timecard option is basically the classic mechanical punch clock in digital form. When you install a timecard system, you’ll give your employees a timecard that closely resembles a credit card. Team members simply swipe their card to clock in and out. These cards and their corresponding device readers automate time tracking, but just as with physical time sheets, there’s nothing stopping employees from swiping each other’s cards to cover for absent or tardy co-workers.
  • Proximity cards, badges and key fobs: Instead of making you swipe a card, these time-tracking options rely on devices that scan identifying cards, badges or key fobs within a certain distance. Many of these tools aren’t just for clocking in and out; they can also track your employees’ movements within your workplace by granting access to certain rooms, hallways and other areas.
  • Biometric : With biometric time and attendance systems, you’ll know exactly who’s checking in and out of your office. These high-tech solutions use facial recognition, fingerprints, eye scanning and other biological identifiers that are unique to each person to ensure the person clocking in is actually the person working. Of course, you’ll pay more for this high-end setup, but with your extra spending comes nearly foolproof time and attendance tracking.
Did You Know?Did you know
You can use employees’ unique biological features, such as fingerprints, to track their attendance without any possibility of "buddy punching," which is one way employees can steal time. However, make sure you're aware of the laws surrounding biometric time clocks before you implement such a system.
  • Web-based login: If your employees work remotely, you’re probably wondering how any of the above solutions could fit your company’s needs. That’s why web-based login stations exist. You can implement virtual time and attendance systems that allow your staff to sign in to work from their laptops, personal computers or mobile devices no matter where they are. All they need is a web browser. Our review of QuickBooks Time outlines one example of how a time and attendance system can serve mobile workforces.
  • Interactive voice response: Another solution for remote employees is an interactive voice response (IVR) tool, which allows remote or field employees to clock in and out via a phone call. The staffer dials the number and goes through an automated system, much like when customers call a company for support.

What to look for when choosing a time and attendance system

With so many time and attendance systems on the market, it can be difficult to know which one is right for your business. When you’re shopping for such a solution, look for these attributes:

  • Flexible time-tracking options: Look for a system that allows employees to record their hours in multiple ways, such as through a computer, phone, tablet, time clock or text message. This ensures employees have a variety of options for clocking in, regardless of their work location.
  • Accurate timekeeping: Good time and attendance systems ensure companies pay their employees for the actual time they work, not for the hours they’re scheduled to work. Before you purchase a system, read user reviews to get a sense of how reliable it is.
  • Tracking for all attendance matters: Choose a system that takes care of all your time-related needs, not one that only allows employees to punch in and out. These functions include employee scheduling and PTO management functions. In addition, if your company charges clients based on time, you may want a system that offers job-tracking logs to record how long your employees work on specific projects.
  • Mobile compatibility: Because many employees and managers today work outside the office, you’ll want a system that is compatible with mobile devices so it’s accessible from anywhere. The system should allow your remote workers to not only clock in and out virtually but also track their locations so you know they’re working where they’re supposed to be. Geotechnology can be extremely valuable for restricting where employees can clock in and out from and for recording the exact locations where they start and end their shifts.
  • Ease of use: Search for a system that is easy to use, has an uncluttered interface and allows employee self-service. The program should not be hard to learn and certainly shouldn’t require hours of training.
  • Integrations: Choose a system that integrates with the applications and software your business already uses, such as your HR and payroll programs.
  • Proactive alerts: Some systems provide notifications when employees are nearing overtime or forget to clock in or out. This can be helpful for controlling expenses.
  • Audit trail features: The ability to view original time sheet data, along with any changes made by a manager or supervisor, can be crucial in the event of an audit.

Pros and cons of time and attendance systems

Overall, business owners and their HR teams should find time and attendance systems beneficial, but here are some specific advantages and disadvantages to keep in mind.

Pros of time and attendance systems

These are some of the benefits of time and attendance systems:

  • No manual timecards: The biggest benefit of modern time and attendance systems is that they eliminate the need for manual timecards. The time is collected electronically, with the hours worked and corresponding pay calculations made for you automatically.
  • Less human error: Because time and attendance software is automated, it reduces the chance of human error in calculations of labor and job costing. The system also frees up the person who was responsible for your manual time and attendance tracking to work on other tasks. Additionally, with fewer errors comes a lower risk of noncompliance with labor laws and regulations.
  • More efficient time tracking: Another positive is that these systems manage all of your time-related needs — including employee attendance, PTO and employee scheduling — in one program. This can result in cost savings and a boost to productivity, as employees won’t waste time toggling between different programs to ask for time off or look at their schedules, and managers won’t need to switch between applications.
  • More accurate payroll processing: With time and attendance software, you don’t have to round the time your employees worked to more convenient numbers that work better with your payroll calculations and pay rules. Your software of choice will automate — and ensure the accuracy of — all of your payments.
  • Extensive integrations: Most time and attendance systems integrate with many other human resources tools, so they work together to improve all of your workforce management tasks, not just your attendance-related processes.
FYIDid you know
Some time and attendance systems are sold by vendors as stand-alone solutions, while others are marketed as part of an HR software package.

Cons of time and attendance systems

These are the main drawbacks of time and attendance systems:

  • Cost: The biggest drawback of time-tracking systems is that they are more expensive than the manual method where employees write down their hours each day or punch in and out on a paper timecard.
  • Occasional errors: Even the best software programs may experience occasional glitches. There’s always a mild risk of errors in tracking or calculation when you use any software, including time and attendance systems, although the risk is lower than with manual calculations.

Costs of time and attendance systems

The cost structure of a time and attendance system depends on whether you choose a cloud-based or on-premises solution. Cloud-based systems have small recurring monthly costs, while on-premises systems typically have large one-time fees.

With on-premises systems, you pay all of your costs upfront. You can expect to pay several hundred to several thousand dollars for the software, user licenses for each employee, and installation. There are no monthly fees for the service thereafter. However, these one-time costs don’t typically cover any ongoing support or software updates.

For a cloud-based system, most vendors charge a per-employee fee that ranges from $1 to $10 per month. Some cloud services also have a base or minimum monthly fee. Additionally, providers may charge a one-time setup and implementation fee. Unlike with on-premises systems, however, all software upgrades and support are included in your monthly expenses.

Did You Know?Did you know
With cloud-based time and attendance software, you won’t have on-site hardware to worry about, so moving your business is easier. Plus, your employees can access cloud-based systems from anywhere at any time, making them ideal for remote teams and multilocation businesses.

One expense you might incur for either setup is a time clock. Many time and attendance systems work with a range of time and attendance time clocks, which can involve PINs, swipe or proximity badges, or biometrics such as fingerprint or facial scans. The complexity of the clock you select will determine the cost. Prices usually range from a couple hundred dollars for a basic clock to several thousand for a sophisticated biometric clock.

Best time and attendance systems

We researched and tested a wide variety of products to determine the best time and attendance systems. Here are five of the many great options available to your business:

  • BambooHR: When you implement this software, you make it easy for your team members to track their hours spent working. Your staffers can submit their time sheets every week or after every pay period. Once the system has the time sheet data, it determines each employee’s pay and taxes, and you make the final sign-off before running payroll. Learn more in our full BambooHR review.
  • Rippling: This time and attendance system excels at self-service. Your employees can quickly see their hours worked and ask for time off, and you can just as easily schedule your team’s shifts. The platform’s compliance features are also impressive; they automate your enforcement of meal break regulations and overtime laws. Explore this system via our in-depth Rippling review.
  • Time Doctor: Fully automated time sheets are part and parcel of Time Doctor, as is the seamless syncing of these time sheets with your payroll software. You can also pull up daily activity data, including your team’s least-productive website usage and which employees are less productive than others. Read more about this time and attendance solution in our comprehensive Time Doctor review.
  • When I Work: Your employees will automatically get clock-in and clock-out reminders when you implement When I Work. You can also restrict employee logins by time, location and channel. The program’s reports are especially great for making scheduling, hiring and budgeting decisions based on previous labor data. Discover what else this platform offers via our detailed When I Work review.
  • TimeClock Plus: Biometric, browser-based, mobile and touchless time clocks are all available through TimeClock Plus. This time and attendance vendor also offers thermal sensors that detect when employees are attempting to clock in while sick. In addition, the software’s employee scheduling features are more advanced than those of many other platforms. Learn more in our extensive TimeClock Plus review.

Time and attendance systems FAQs

Still have questions about time and attendance systems? Below, we've answered some common questions to help you select the right platform for your business.
The biggest difference with time and attendance systems is that everything is digitized and automated. Traditional time clocks and timecards require manual data entry for everything. Time and attendance systems only require the push of a button for all of your company's attendance information to sync with the software. That software then seamlessly integrates with the best payroll services for accurate payment, thereby eliminating duplicate entries, errors and guesswork. In addition, time and attendance systems log hours, job codes and information about breaks and PTO digitally and in real time, which traditional time clocks and timecards cannot do.
The type of time clock that's compatible with a given time and attendance system depends on which solution you choose. Today’s time clocks collect time in different ways, including via punch cards, magnetic swipe cards, barcodes, PINs, and biometrics such as fingerprints or facial scans. Most vendors offer a variety of methods, and you can choose the one that's best for your workforce.
Any time and attendance system that works with a biometric time clock is a biometric system. Because nearly every time and attendance solution that works with physical time clocks offers biometric options, there is very little difference between the two. Biometric time clocks are best to use if you are concerned about "buddy punching," in which an employee clocks in on another employee's behalf. Biometric systems prevent that by tying the clock-in process to each employee's unique biometrics. The only time and attendance systems that don’t have biometric options are those that don’t incorporate biometric time clocks and instead rely on other means to punch employees in and out. However, even some of those systems now offer fingerprint scanners that plug into computers or use programs that take employee pictures with a computer camera as a way to incorporate biometric options.
No, you do not have to use a time clock with a time and attendance system. Some businesses prefer employees to clock in and out only through a computer, mobile app or phone. Forgoing a time clock can cut down on costs, as each time clock can run anywhere from a couple hundred to several thousand dollars.
While it might seem like time and attendance systems are only good for businesses with hourly employees, businesses with salaried workers can reap a number of benefits from them as well. A system that tracks how long employees work on specific projects can help with labor projections. Additionally, businesses with salaried employees may appreciate the PTO management aspects of these systems.
Time and attendance systems use virtual clock-in methods and GPS technology to monitor remote workers via mobile devices. Some systems use geofencing to limit where employees can clock in and out from, while others use geolocation to record exactly where workers are when they punch in and out. The systems can also use geolocation to track employees throughout the day, not just where they start and end their shifts.
Time and attendance systems integrate with payroll systems by allowing you to transfer your time and attendance data to your payroll program with one click. This cuts down on errors in collecting data and streamlines the entire payroll process.
Time and attendance systems manage PTO in several ways. They can track how much time off employees have earned and used, as well as manage accruals for sick time, vacation, bereavement and any other type of time off employees may receive. Some time and attendance systems also handle the request-and-approval process. This allows employees to ask for time off directly within the system, and managers can either approve or deny those requests.

Choosing the right time and attendance system

Although fancy-looking biometric time clocks might seem cool and exciting, the best time and attendance system isn’t always the most eye-catching one. Instead, you should choose the system that offers your business the highest value within your budget based on the research and product comparisons you’ve conducted. Keep the above information in mind when you’re evaluating different systems. Then, pursue free trials or product demos, and you’ll know intuitively which platform suits your needs best.

Max Freedman contributed to this article. 

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Chad Brooks, Business Ownership Insider and Managing Editor
Chad Brooks is the author of How to Start a Home-Based App Development Business. He has spent more than 10 years guiding prospective entrepreneurs and business owners on the ins and outs of launching a startup, scaling a company and maintaining profitable growth. Within the world of entrepreneurship, he is particularly passionate about small business communications tools, such as unified communications systems, video conferencing solutions and conference call services. Brooks, who holds a degree in journalism from Indiana University, has lent his business expertise to a number of esteemed publications, including Huffington Post, CNBC, Fox Business and Laptop Mag. He regularly consults with B2B companies to stay on top of the latest business trends and direct growing enterprises toward the modern-day business technology required in today's digitally advanced world.
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