Time tracking laws are designed to protect both employers and employees. They ensure fair labor practices and help prevent disputes related to pay and hours worked.
These laws seem complex at first, but they’re fairly straightforward once you break them down. And that’s exactly what this article aims to do.
Here we’ve distilled everything you need to know about federal time tracking laws, from key time tracking regulations down to time tracking best practices that will help you streamline the process.
This Article Covers
- Is Time Tracking Legal in the US?
- How Should US Employers Track Employee Time?
- Key US Federal Time Tracking Laws
- Can US Employers Round Up Employee Work Hours?
- Do US Salaried Employees Still Need to Track Time?
- Can Remote Employees in the US Be Required to Track Time?
- How Long Should US Employers Keep Employee Time Records?
Is Time Tracking Legal in the US?
Time tracking is completely legal under US federal law. In many cases, employers are even required to track employee time so they have a clear record of work hours as basis for compensation. And with that comes the responsibility to ensure that the process of tracking is accurate, transparent, and compliant with relevant regulations.
How Should US Employers Track Employee Time?
Employers have the flexibility to choose any method for tracking employee time. This is as long as time records are complete and accurate.
Some common time tracking methods include:
- Pen and Paper – This traditional approach involves employees writing down their hours worked on paper timesheets. While it’s easy to implement, this method can lead to errors, such as miscalculations or illegible handwriting, and it requires diligent oversight to ensure accuracy.
- Physical Time Clock – A physical time clock allows employees to clock in and out using a card or badge. This method is straightforward and can improve accountability, but it may require regular maintenance and monitoring to prevent misuse or malfunctions.
- Spreadsheets – Many employers use spreadsheet software to track hours worked. Employees can enter their hours in a shared document, making it easy to compile and analyze data. However, this method can become cumbersome as the workforce grows and since it still requires manual data entry it still has a significant risk of errors.
- Time Tracking Software – Time tracking software automates the process, allowing employees to clock in and out digitally using computers or mobile devices. These systems often include features like automated reporting, overtime calculations, and integration with payroll systems, making them efficient and user-friendly.
Every time tracking method has its advantages and disadvantages, so it’s important to carefully assess which system aligns best with your organization’s specific needs.
Learn more about the different ways you can track time with Jibble.
Key US Federal Time Tracking Laws
The main federal law that covers time tracking in the US is the Fair Labor Standards Act (FLSA). This act outlines provisions for timekeeping, minimum hourly wages, overtime rates and limits, working hours, and so on.
- Employee Timekeeping: There’s no one required method for timekeeping or time tracking mandated by federal law. Employers have the flexibility to choose how they track time, whether it’s through manual timesheets, time tracking software, or other methods. It is however important that employers keep a clear record of employee attendance and work hours. This not only ensures compliance with wage and hour laws, but also helps avoid potential disputes over pay, overtime, and work schedules.
- Minimum Wage: Each tracked work hour should be paid the state or federal minimum wage, whichever is higher. Minimum wage laws vary by state but the federal minimum wage is set by the Fair Labor Standards Act (FLSA) at $7.25 per hour.
- Overtime: Employees who are covered under the FLSA must be compensated at a rate of at least one and a half times their regular pay for any hours worked beyond 40 in a week. The FLSA does not mandate overtime pay specifically for working on weekends, holidays, or rest days, unless the total hours worked exceed 40 in the workweek.
- Breaks: Federal break laws don’t require lunch or coffee breaks, but if employers offer short breaks (usually 5 to 20 minutes), they must be considered paid work hours and count toward total hours worked, including overtime. Meal breaks, typically lasting 30 minutes or more, are not considered work time and don’t need to be paid as long as the employee is fully relieved of duties.
- Working Hours: The FLSA does not set a limit on working hours for adult employees. Instead, it primarily addresses overtime, ensuring that non-exempt employees who work more than 40 hours in a week receive overtime pay. However, for employees under 16, there are restrictions: they cannot work more than 3 hours on a school day or 18 hours during a school week. During school breaks, they can work up to 8 hours per day and 40 hours per week.
Can US Employers Round Up Employee Work Hours?
Under the Fair Labor Standards Act (FLSA), employers are allowed to round time to the nearest 15-minute increment.
For example, if an employee works 1 to 7 minutes, the time can be rounded down, but if they work 8 to 14 minutes, the time must be rounded up to the nearest quarter hour. Employers who consistently round down employee work hours could be violating minimum wage or overtime laws, so it’s important that the rounding practice balances out over time.
Do US Salaried Employees Still Need to Track Time?
Salaried employees receive a fixed salary regardless of the number of hours they work, which means their compensation isn’t directly tied to hours worked.
But while it’s not mandatory for salaried employees to track their hours, doing so can provide valuable insights for better time management and productivity.
Many salaried employees choose to keep track of their hours to manage their workload effectively and ensure they meet their responsibilities within a reasonable timeframe. Additionally, tracking time can help identify patterns in productivity, enabling employees to optimize their work habits.
Learn more about why time tracking is necessary for salaried employees in the US.
Can Remote Employees in the US Be Required to Track Time?
Yes, employees can be required to track time even if they’re working remotely. This is to ensure that they are compensated properly for their time. It also helps managers view project progress and ensure that deadlines are met and tasks are completed efficiently.
Learn more about time tracking best practices for remote professionals.
How Long Should US Employers Keep Employee Time Records?
As per the FLSA, employers are required to keep records related to employee wage computations for at least two years.
This includes timesheets, time cards, piecework tickets, wage rate tables, work and time schedules, and any records of additions or deductions from wages.
It’s important that these records are accessible for inspection by the appropriate regulatory representatives, who may request the employer to provide extensions, computations, or transcriptions. Employers can keep these records at the workplace or in a central records office to comply with recordkeeping requirements.
Important Cautionary Note
When making this guide we have tried to make it accurate but we do not give any guarantee that the information provided is correct or up-to-date. We therefore strongly advise you seek advice from qualified professionals before acting on any information provided in this guide. We do not accept any liability for any damages or risks incurred for use of this guide.