Nevertheless, even small organizations with less than 100 employees, calculating work hours and translating those to payroll can be needlessly time consuming and complicated. Employees traditionally keep their own time cards, sometimes with a time clock to check their entrances and departures and sometimes without.

Actually, employees add up the hours they have worked and submit the totals to a supervisor, bookkeeper, or an accounting department. They do this at the end of every pay period.

Doing the calculations, employees simply disregard ten or fifteen minutes here or there. The reason is not that the employees are dishonest or even want to cheat the system. This is because they simply do not understand the ramifications of their few minutes' departure from actual truth connected with the similar departures of dozens or hundreds of other people and the cost influence those minutes can make on the company's benefit picture.

Collecting time cards, going through them for checking goals, correcting any mistakes, and re-adding all the figures to make sure they are accurate are tasks someone in the accounting or payroll department has to do in a manual system. The timing is a perfect solution to make the whole system work, and even more so if an outside payroll company is used. Such companies require that all information be submitted by a particular date in order to generate checks by a second designated date.

So, manual systems for tracking time and attendance and generating payroll from the figures gathered take time and they cost money. Time and attendance software systems, even though they also cost money, tend to pay for themselves rather quickly.

Electronic time clocks to be located at each entrance to the workplace, along with software to integrate all of the system's functions are what a single system for a small company consist of. Thus employees either scan a time card or an identification badge through the time clock when they arrive at work and when they leave. The software continuously gathers information from the time clocks and stores it in a central database. The time clocks can be hard wired to one computer. If this is so, then a single employee can check daily attendance and verify time spent on breaks and lunches in just a few minutes per day.

In this way, information can be exported directly to an Excel spreadsheet and generate reports of regular and overtime hours. Having taken two employees two or three days worth of time, the payroll processing can be completed by one employee in a few hours once a week or once every other week, depending on the pay cycle.

The exactness and effectiveness of time and attendance software can be exceptionally valuable to any company regardless of size. Moreover, it can automatically generate payroll records, track any one of a number of variables requested by the employer, and helps to keep both employees and employers honest.