What is main importance of employee timesheets management?

What is main importance of employee timesheets management?

April 14, 2022

Timesheets aren’t the most popular part of a worker’s daily routine. Moreover, employees can consider them unnecessary and counterproductive. Employers, on the other hand, also tend to use this important business practice only to monitor their employees, often not understanding the bigger picture.

We are here to tell you a little bit more about the possibilities timesheets offer, and help you use them more efficiently. So, whether you are an employee struggling with their daily reports or a business owner or manager who wants to get the most out of timesheets – keep reading our article.

What Are Timesheets?

Timesheets are tables containing data about the time an employee has spent working during a specific period. Timesheets usually come in three forms:

  • Paper timesheets
  • Excel spreads
  • Digital timesheets created through a dedicated platform

But some variations are possible as well.

Employees fill out the timesheets at the end of a workday and submit them. Then, the managers or other higher-ups can look through either the timesheets themselves or the reports delivered by the platform. It is important to add that paper timesheets are seeing their way out of use, as they are the most difficult to manage and filter.

On the other hand, electronic timesheets can give you a great insight into the way your employees spend their time. Let’s explore all of their advantages.

1. DCAA Compliance

Defense Contract Audit Agency (or DCAA for short) is an organization that provides financial advisory services. Their other duty is conducting contract audits. This means that businesses that fall under DCAA rules need to have certain data available at all times in case of an audit.

The data DCAA requires includes employee hours. In other words, the Agency directly asks for some kind of daily timekeeping for all employees. A timesheet program offers all necessary information relating to timekeeping. That is to say, you won’t have to worry about this aspect of documentation as it is readily available at all times.

Simply put, timesheets help your business remain within DCAA regulations. This helps your organization function in the most general legal sense.

2. Project Management

To be able to manage your projects successfully, you will have to understand the business processes occurring in your company. Knowing how much time a certain task usually takes is the first step toward efficient and accurate planning.

On the other hand, being able to pinpoint the stage of a certain project is also important for many reasons such as cost and time estimates and understanding whether you need to delegate tasks differently or not. Seeing the tasks that have been completed and the ones that still haven’t commenced will allow you to manage specific projects with more accuracy. This is a great way to gain a good reputation with your clients.

3. Notice Employee Stress

Leading a happy team is a balancing act. Your employees need to be productive, but not approach burnout caused by overworking. Timesheets are important in this case too, as you will be able to notice changes in performance.

If, for example, a usually hardworking employee’s results start (and continue) to dwindle, they may be experiencing personal or work-related stress. It is up to you, as a manager or business owner to approach them and have a constructive conversation.

This means being careful not to be judgmental or place the blame on the employee. You should, instead, suggest they should use some of their paid time off or ask whether they need a helping hand with a part of their workload. If the previous point helped you gain a reputation with your clients, this one will help you become a great employer, boost overall morale, and attract more desirable talent for future openings.

4. Billing and Invoicing

This is a practical and important element that would be impossible without accurate timesheets. The timesheets contain all employee activity, as well as the time said activity took. This means you will be able to attach a document containing that activity both to your invoices to clients and the employee payroll slips.

This way you will be able to calculate the exact cost of a project and charge for it adequately while avoiding any potential questions your clients may have. Similarly, it is important to be transparent when it comes to employees’ work hours in the previous period and the amount you pay them.

Being transparent in your business practices is the best way to remain reputable in any industry. By doing so, you are showing both your clients and your employees you are looking to run your business in a way that is fair to everyone.

5. Stop Time Wasting

Each workplace has its fair share of time wasters. To be just to everyone, wasting time isn’t a conscious decision in most cases. People will simply get off track, talk to their coworkers, or get carried away with different internet distractions. None of these activities is actively malicious, but they still cost the company money.

Time tracking will show you which employees are prone to time wasting. The time they spend at work but not working will impact their results. Here’s an example:

Alexa and Ophelia work as content writers. While Ophelia manages to write two well-researched articles each week, Alexa has the habit of browsing social media and taking time with her breaks. Hence, she writes three articles in two weeks. This is a huge difference. However, once Alexa starts tracking her time through a timesheet and conducts a time audit, she notices how her time gets away from her. She then reduces the time she spends on Facebook and Twitter and increases her productivity to match Ophelia’s.

6. Reduce Time Theft

Time theft is comprised of different activities that allow employees to be paid for the time they haven’t spent working. The most common types of time theft include

  • Fudging with numbers
  • Coming in late and/or leaving early
  • Buddy punching
  • Unregulated overtime

Even though the results of time wasting and time theft are the same, the intent behind them is different. Time theft is done purposely, with the goal to reduce one’s work and increase their pay.

Again, timesheets are there to level out the playing field. Let’s return to our previous example, with a twist. Now Ophelia is the culprit, but instead of taking longer breaks or chatting with her coworkers, she does something different.

Ophelia has noted the overtime regulations in her company. The regulations say that each employee must be paid at an increased hourly rate for every hour of overtime. Hence, Ophelia decides to stay in the offices longer, or even simply log overtime even when she isn’t at the offices. However, even though she works five to ten hours more than Alexa, their results are nearly identical. The management will notice this through timesheet management and plan their course of action.

What to do with Alexas and Ophelias?

If you notice significant differences either in time or quantity and quality of work, it is important to take action. This means talking to your employees and reviewing their performance. Make sure to be understanding, as the discrepancies can come from different sources (i.e. the abovementioned stress and overworking). If the results don’t change even after you’ve given your employees the time to recharge their batteries, you will probably have to take some more drastic steps.

Not addressing time wasting and theft lowers the morale of your workforce, as the hardworking employees can see their results are being treated the same way as their time-wasting coworkers’. This can lead to apathy and an overall decrease in productivity.

7. Save Money

Making a business more profitable is the goal of all businesses. Having a firm grasp on the business processes taking place in your company. This is most effectively done through monitoring the individual performance of all employees and creating a sort of leaderboard.

That is to say, you should motivate your more hardworking team members and identify the ones that cost your business more than they contribute. Having this information will help you make better business decisions.

Since timesheets ensure proper pay for every team member, employee turnover tends to decrease in the companies that use them. Simply put, the morale of your staff will improve, and there will be less chance of them leaving the company. This means the costs of recruiting and training new employees will be smaller, and your team will keep working at an optimum level as the team members know each other already.

8. Calculate and Reduce Costs

Timesheets provide information on employees and clients alike. Knowing whether a specific project is bringing in the amount of money you are expecting or not is one of the basic business principles. Employee time is the most important resource when it comes to professional service companies. That is to say, having information about the time spent on a project is important for cost calculation.

Knowing how much time and other resources go into a project can also help you identify the low-performing clients. Then you can negotiate the terms of your contracts with them (for example going from a fixed fee model to an hourly rate), or terminate them completely.

This way your team will have the time to dedicate to the more important and profitable clients and projects with higher margins. In other words – productivity will increase without your employees having to work more.

9. Allocate Resources and Expenses

The data timesheets provide will help you recognize the resources used for every project. We have developed Time Analytics to allow our users to automatically connect the time spent on a project to the clients connected to that project.

This way the hours and other expenses for each employee will be automatically allocated to the right clients. You can export timesheets in Excel and calculate the fees accurately, including employee hourly billing rates and overhead expenses.

10. Receive Reports

Timesheet programs usually come with a plethora of report options. You would otherwise have to calculate the most important performance indicators for your business. By using timesheets regularly, you will receive reports on

  • Time utilization
  • Top and low performing clients and employees
  • Profit margins
  • Overtime
  • Contribution to growth
  • Return of investment

And many more.

11. Detect Issues on Time

Receiving the abovementioned reports, as well as being able to track performances in real-time will allow you to notice different trends very early on. Knowing a certain aspect of your business is starting to go in an unwanted direction before it takes a toll on your company.

Taking corrective actions is much more efficient the earlier you start doing it. You don’t want to be caught unawares once the negative effects snowball and put you in a situation you can’t find a way out of.

12. Find a Way to Improve

On the other hand, you can use the reports you receive to find new methods and approaches to create a more efficient work environment and motivate your employees. Making small changes can impact your business in unexpected ways, and being able to monitor these changes both in real-time and over a certain period will give you all the necessary information to know whether to continue with the practice, make changes, or completely stop.

Timesheet Management

As you can conclude from our arguments, timesheets are a great addition to a company’s workflow. However, without proper management, making your employees fill out their timesheets is just another part of a procedure that makes no sense or merits.

Timesheet management includes analyzing timesheets and monitoring how the employees interact with them. The data within the timesheets is supposed to be as accurate as possible if you want to make a real difference in your business. Yet, managers face a lot of problems with employee timesheets. This is especially prominent in the beginning, while the company is still implementing the practices.

Some growing pains are expected either way when you start a new business practice. Still, you can make them more bearable by keeping up with the employees’ timesheets regularly and making adjustments in due time.


Talking to your team regularly is the key component of any business’s efficiency and success. Even the timesheet programs with the most advanced features and numerous options cannot completely replace a simple conversation. Hence, our first tip for successful timesheet management is to continue clear and open communication with other team members.

We have shown in our previous examples how similar results can come from completely different circumstances. That is to say, you won’t be able to differentiate between slackers and employees struggling with their workload at a glance. Often, you’ll have to observe the employees in question and discuss their behavior with them and other members of their team.

Open communication like this is a great way to become closer with your team and create a more positive work environment for everyone. This, of course, means building a company culture that is both transparent and positive for all sides.

Learning the Ropes

Are you a team leader or manager in a company that is planning to implement a timesheet software solution? In that case, there’s no time like now to start learning about the program you’ll be using. Understanding the ins and outs of both the platform and the ways to use it that are tailored to your company’s needs is a winning combination.

This means that you will have to understand the ways your company can benefit from using the system. However, more importantly for the beginning, it is crucial to see the potential problems and questions the rest of your team could have before the implementation process begins at all.

Supporting Your Team

Now that you know your way around the program, it’s time to implement the timesheet timekeeping model for the rest of your team. Start small to be sure you can handle potential mistakes and answer the questions your team has. Making adjustments is much easier with a smaller number of people.

Be prepared to give support to your team, especially in the beginning. This includes

  • Answering employee questions
  • Adjusting the program to fit a specific team’s needs
  • Troubleshooting issues
  • Contacting the platform’s support team when needed
  • Reminding employees to fill their timesheets daily (as opposed to weekly) for higher accuracy

Regular Control

You can’t do much with the timesheets if you cannot analyze the data it delivers. This is why you should review employee timesheets regularly. Depending on your business, this can mean daily, weekly, bi-weekly or monthly reviews. The reviews should make sure that the data entered into the timesheets is accurate. Only then will it reflect the true state of your company.

Use all Relevant Features

Be sure to use all features the platform offers that fit your business’s needs. Whether it’s specific reports, time tracking via automatic timers, or physical checking in and out systems, it is important to utilize the system to the best of your abilities.

For example, Time Analytics offers a feature that enables users to save timesheet models as templates. Users can simply fill out these templates and be sure all necessary data is provided. Additionally, our platform makes time tracking simpler by auto-filling the task, project, and client fields and offering a drop-down list of the most recent entries. This way your team members won’t have to type the full name of the task or search for it in alphabetical order.

To Conclude

Timesheets are a great addition to any company’s workflow. They are, first and foremost, a great way to remain DCAA compliant and go through a government audit without any issues. Secondly, they allow managers to track their and their team’s progress on different projects. They have many other advantages, such as accurate salaries and invoices.

However, some issues are bound to occur while using any timesheet method – be it paper, Excel, or a dedicated program. That is why managers need to stay up-to-date with employee timesheets and give the employees instructions on how to use them.

Timesheet management is a crucial part of using timesheet programs, as it provides data accuracy. Accurate data is, on the other hand, necessary to generate reports that reflect the real state of a company. In other words, timesheet management is the step that separates productive and unproductive timekeeping.


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