A timesheet is a record of the hours an employee works during a specific pay period, serving as the document for calculating wages and managing labor costs. Using an accurate and consistent timesheet format is the primary way businesses ensure employees are paid correctly and that project billing is managed without error. This recordkeeping is also significant for complying with federal labor laws, which mandate that employers keep precise track of all hours worked by non-exempt employees.
Essential Components of Any Timesheet
Every timesheet must capture specific data points to satisfy payroll needs and governmental recordkeeping requirements. These components establish the link between the hours recorded and the individual worker receiving payment.
- Full name, employee identification number, and the pay period covered.
- Daily start and finish times for each day of the workweek.
- Non-paid meal or rest breaks taken, which are subtracted from the total time.
- Project codes or client references if the business uses time for billing or internal cost tracking.
- Total daily hours worked.
- A signature line for both the employee and a supervising manager to verify accuracy.
Choosing the Right Timesheet Format
Selecting the right format involves balancing convenience, cost, and the need for calculation accuracy. The format chosen acts as the delivery mechanism for the required data fields.
Paper or Printable Templates
Paper timesheets are the most straightforward option, requiring only a printed template and a pen. They are suitable for very small teams or individual contractors. Manual entries are susceptible to calculation errors when totaling daily or weekly hours. The physical storage of these records can also become disorganized and unwieldy over time.
Spreadsheet Programs (Excel/Google Sheets)
Spreadsheet programs represent an accessible digital compromise, offering a high degree of customization and the ability to automate calculations. Creating a timesheet allows the user to implement basic formulas that automatically calculate daily totals, subtract breaks, and compute weekly hours. This format minimizes manual arithmetic errors and is often the preferred choice for small- to medium-sized businesses.
Dedicated Time Tracking Software
For organizations with complex reporting needs, project-based billing, or a large number of employees, dedicated time tracking software offers the highest level of automation. These systems often integrate directly with payroll platforms and enforce compliance rules. They may also offer features like geofencing or mobile clock-in capabilities. While this software involves a recurring cost, it significantly reduces administrative overhead and provides a clear trail of time entries.
Step-by-Step Guide to Creating a Spreadsheet Timesheet
Creating a timesheet in a spreadsheet program requires careful setup to ensure the automated calculations function correctly. The sheet must be structured with necessary column headers. These should include Date, Time In, Time Out, Meal/Break Duration, and Total Daily Hours. A separate column for project or client names is helpful if tracking time against specific tasks is necessary.
Users must format the time columns to ensure the program recognizes the entries as time values. Set the Time In and Time Out columns to a consistent time format, such as the 24-hour clock or a standard AM/PM designation. Using a consistent format prevents calculation errors that can occur when mixing different time notations.
Implementing the core formulas is the most important step for automating the sheet’s functionality. The formula for calculating the Gross Shift Time involves subtracting the Time In from the Time Out for the main shift. The formula in the Total Daily Hours column must then subtract the Meal/Break Duration from the Gross Shift Time.
The spreadsheet should include a formula at the bottom of the column to calculate the Total Weekly Hours worked. This cell should sum the entries in the Total Daily Hours column, providing a single figure for payroll processing. For a final check, conditional formatting can be applied to visually flag entries that fall outside of a normal range, which helps managers spot potential errors before submission.
Ensuring Accuracy and Compliance
Establishing a consistent workflow for submission and approval is necessary for maintaining accurate records and compliance with labor law. The Fair Labor Standards Act (FLSA) requires that employers maintain accurate records of employee hours worked each day and week. The employer is ultimately responsible for the accuracy of these records, making an employee’s verification signature and a supervisor’s approval signature necessary.
Accurate recordkeeping also involves adherence to specific rules, such as those governing time rounding and break deductions. If a company uses time rounding, the policy must be neutral and consistently applied, ensuring it does not systematically benefit the employer. Unpaid meal breaks must be tracked diligently. Rounding should not be applied to unpaid break times, as this can lead to questions about whether the full, required break was taken.
For federal compliance, records used to calculate wages, such as time cards and work schedules, must be preserved for at least two years. General payroll records, including earnings, additions, and deductions, must be kept for a minimum of three years. Establishing a procedure for correcting timesheet errors is also important, ensuring that any changes are clearly documented and approved by both the employee and the supervisor to maintain an auditable trail.