Best Practices from Former Wage/Hour Administrator

Timekeeping and Payroll Best Practices

McCutchen suggests HR managers pay attention to the following issues:

Causes of Off-the-Clock Claims

• Paying shift time
• Failing to capture pre- and postshift work (booting up time, preshift meeting time, etc.)
• Automatic deductions for unpaid meal breaks
• Exception time reporting
• Paper timesheets
• Inconsistent time and payroll records

Timekeeping Best Practices

• Electronic timekeeping
• Pay to the punch
• No rounding
• Punch out and in for meals
• Certification of work hours
• Control time adjustments

Payroll Best Practices

• Use a weekly or biweekly payroll (With a twice-a-month payroll, it is too hard to calculate overtime, McCutchen says.)
• Do minimum wage testing to be sure you aren’t deducting so much that employees dip below the minimum wage.
• Flag earnings codes that should be included in the regular rate.
• Maintain documentation for deductions.
• Do a regular audit of payroll records.

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Other Really Good Ideas

Consider the following, says McCutchen:

• Do a pay stub disclosures audit.
• Have a policy and process for interrupted meals.
• Clarify your procedure for final pay (e.g., in California, final paycheck must be issued on the final day of work).
• Have an hours worked policy. (It is our policy to pay for all hours worked; e-mail HR if there is a problem. If you are asked to work off the clock, report that to HR.)
• Have a payroll integrity policy. (Report any issues, etc.)

How do you prevent people from clocking in early everyday and potentially gaining 15 minutes of pay a day? You have to set up your system so that it won’t accept punches until X minutes before start time.

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