5 Timesheet Best Practices Your Small Business Should Implement

Timesheet Best Practices

One of the biggest challenges many companies face when trying to stay compliant with certain government regulations is properly implementing time-tracking software. With a plethora of options, including both low-tech and high-tech, it can be a challenge to determine the right software, the right methods and the best practices to implement company-wide.

Here’s a look at some timesheet best practices that include some of the most basic and important practices for finding the right time tracking software for your organization.

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Implement Time Tracking From the Top, Down

Nothing can demoralize employees more than feeling that there’s a double standard, especially when it comes to tracking their time. When the boss not only promotes time tracking, but uses it, this helps emphasize to employees the importance of time tracking for everyone involved.

There are many creative ways to hold the entire organization accountable. Ad agency Colle+McVoy implemented not only a timesheet system, but a software solution that allows a company-wide beer fridge to open every Friday, provided that all employee timesheets are submitted on time.

According to Adweek:

“Colle+McVoy has built a wondrous machine called the TapServer — a “multi-keg beer deployment system” that uses RFID and custom-written software to verify whether you’ve stopped being a lazy git, finished your timesheets and earned your free pint.”

Especially with something as potentially unpopular as time tracking, knowing the boss values it enough to do it themselves and apply the same rules company-wide can be a powerful motivation for everyone else to do their part.

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Offer the Necessary Training

Communication is everything. Making sure everyone understands what’s involved in accurate time tracking can change the way your employees respond to your new timesheet policies by leaps and bounds. Despite an employee’s good intentions, if they don’t understand what is involved, it can lead to errors and missing information on timesheets.

This is especially important for companies that work with government agencies, have either hourly or salary employee types, or any other organizations who have stringent time tracking requirements. Proper training can often mean the difference between remaining compliant and losing a valuable contract altogether.

Automate the Entire Process

DCAA News is an organization that provides information for contractors looking to become DCAA-compliant and secure government contracts. Since maintaining DCAA compliance requires accurate time tracking, it’s worth noting one of the recommendations DCAA News makes:

“… Skip any form of manual bookkeeping; make your life easy with an automated software system that is DCAA compliant. These software packages can inform what data needs to be tracked, can automate approvals, can allow for employees to clock in or out from anywhere, creates invoices, enables downloads into QuickBooks, tracks leave time, can create extremely detailed ad hoc reports, provides password protection and so on. These software packages can allow managers to managers on more tangible tasks while at the same time being able to view accurate timesheet data.”

Not only will automating your business processes keep you government compliant, but it will also massively help in keeping your company data secure. According to a study from IBM, “95 percent of all security incidents involve human error.” Yeah, that’s insanely high.

Automating your processes will not only mitigate that data risk, but will also help keep you compliant, and as long as you’re properly training your staff to follow these new systems, your organization will be able to make the most out of your timesheet system.

Move to Hourly Employees

While salaried employees may sound good in theory, in practice, the arrangement rarely works out for employer or employee. It’s far too easy for an employee to take advantage of the non-results oriented paycheck, while many employers try to get more than their money’s worth from the employee. The result is often a tug-of-war struggle where productivity is the ultimate casualty.

April Dykman, writing for Get Rich Slowly describes some of these challenges:

“At another job, I was told that being on salary meant that ‘if we close the office early, you’ll still get paid.’ But we closed the office maybe two or three afternoons out of the year, and there were many, many events that required 8+ hour days. Once I put in a 22-hour day for a particularly big event.”

A far better solution is to move all employees to hourly pay, where each party clearly understands what’s expected and there’s far less room for one to take advantage of the other.

Record Your Time Daily

One of the biggest mistakes many make is recording time sheets at the end of the week. Many of us can hardly remember what we had for breakfast yesterday, let alone remember and recreate entire work days after the fact. To maintain good records and best practices, make sure everyone in the company is recording their timesheet at least once daily.

Conversely, to help facilitate that, make sure the process of recording a timesheet is not so convoluted that it’s a major chore to do so. Recording a timesheet should take no more than a few minutes each day.

While certainly not exhaustive, these timesheet best practices are some of the most important, and sadly, overlooked.

If your organization can implement these while the timesheet system is being implemented, and can continue to communicate clearly and effectively with your employees – your company will function all the better for it.

Stopwatch Photo via Shutterstock


Curt Finch Curt Finch is the CEO of Journyx. Founded in 1996, Journyx automates payroll, billing and cost accounting while easing management of employee time and expenses, and provides confidence that all resources are utilized correctly and completely.

7 Reactions
  1. As a busy business owner with employees moving around from client to client, we have a great need to track not just the start and stop time but we have a need to track their time for each item that they are doing and who they are doing it for.

    After years of looking around and trying different systems, we find that TSheets is not just the best solution for us but for our customers as well.

    TSheets seamlessly integrates in with QuickBooks and keeping track of where my employees are and what they are doing could not be made easier.

    Anyone with employees in the field or even at a static location, TSheets is a must have3 solutions.

  2. Great article! I hated tracking time. When I used to work at a temp agency, I remember frantically putting my carbon copy timesheets together, and as you pointed out in the article, I couldn’t remember what I had for breakfast today, let alone what I did at the beginning of the week. Eventually I developed my own spreadsheet for tracking time. At that time this was revolutionary, but it made it easy for me, because I could keep that spreadsheet open all day, and log what I was doing as I was doing it. This definitely kept me much more honest.

    A few years ago I met some people from TSheets.com, and I am so glad I did! These guys have truly revolutionized time tracking. You can clock in and out from the mobile app (or desktop if that’s where you happen to be). This definitely keeps us honest at my company. There’s also great reporting on the time, assigning to jobs / projects is a no brainer, and for those who are using QuickBooks, this is synced beautifully, so you can use the information to process payroll and pay sub-contractors in a fraction of the time. I know it probably sounds like I am selling the software. I guess I am, in a way. It’s just made my life so much easier at my company. I highly, highly recommend TSheets!

  3. I have to agree about the training. One of the things I learned is that untrained employees usually take longer to finish a job that can be done another trained employee. That’s how crucial it is when it comes to the time-deliverables ratio of employees.

  4. I truly rely on time information to analyze my company’s performance. In 16 years I have never had an application that could solve for these critical analytics. When you work with the variety of clients that we work with, this is a tool that we could not possibly live without. As the owner of the business, I am not in this to break even. Rather, I am depending on my profitability to run my company. This tool simply solves for my needs. True business owners should get this under control.

  5. The things about training and tracking rime is really important. These are two practices which can make the work of your employees and yours more efficient.

  6. With a good time tracking tool we can accurately measure time and performance both for team members and projects. I am using Moneypenny.me – it is time tracking and invoicing software. I can see in real time who is working on which task and how much time he is spending on it. It gives me a good insight on productivity of my team