PC based time clock & Exempt Employees

Golf · March 2002

We are in the process of getting a PC based time clock that would tie in with our payroll system. We are thinking of having everyone including exempt employees clock in and out using this new time clock. Do you see any problems in having exempt employees clock in and out as long as we do not deduct their pay for working less than 40 hours in a week?

DeniseR · March 2002

actually, we were thinking of doing the same thing. We had our corporate attorney look into the system and see if it was legal for us to require the exempt employees to use it as well. Her response was, that it was ok as long as you did not dock their pay. Unless thay took a whole days off in which you could deduct their benefit time. Hope this helps.

Christine M · March 2002

Technically, Exempt employees are being paid to do a job, rather than the amount of hours that it takes to do that job. You can have them use the time clock, but if they work any time in the day, they must be paid for the full day, whether it is through salary or use of benefits such as vacation time. In the event that they have used all of their allowed leave time, you may not deduct their pay unless they are absent for a full day.

Working less than the expected work hours you state in your policy, and having insufficient leave to cover the time, is a management issue separate from pay and may be addressed with some sort of corrective action, i.e., counseling, verbal warning, etc.

santire · March 2002

Having exempt employees clock in and out whether via a PC system or a classic time clock system is very risky. While it is OK to do so for billing purposes to allocate time such as an engineering firms allocating exempt employee engineering time via the accounts receivable department to bill clients, it is highly inaappropriate for such records to go to the payroll department. The concept of having exempt employees clock in and out can create considerable liability if they work long hours which is much more likely than the idea of them usually working less than 40 hours. The entire idea of keeping time records for exempt employees in the same system as nonexempt employees is inappropriate. As a minimum, keep them separately and do not have the payroll department track the exempt employee hours. If you are a small company which does not formally distinguish between a payroll department and an accounts receivable department, keep the records separate and in separate form. Just to add one point, there can be other valid reasons for tracking exempt employees than just to bill a client. For example, internal cost allocations among projects, tasks, or programs to see how efficiently the company is using its resources, including exempt employees. Still, keep them separate from that of nonexempt employees.

Carol CA · April 2002

Why would you want your exempt employees to clock in and out? You say the clock would be tied in to your payroll system. Exempts are paid the same amount each pay period. We have a time clock for our non-exempts, but we do not make our exempts clock in and out. In fact, many times our exempt sales people will be working, but out visiting clients and not coming into the office. Although they are "absent" from the plant for a full day, they are working and should be paid.

Most exempts will grumble at being treated like a non-exempt and having to clock in and out. I would't go down that road.

PC based time clock & Exempt Employees

Comments