TAM: Why a time management solution is essential for companies operating internationally

What are the legal obligations regarding the monitoring of working time?

Increasingly governments are enacting laws that make it mandatory for companies to comply with specific time tracking standards. France, Switzerland, Spain, Poland, and others are examples of this growing trend, particularly in Europe. HR Directors and legal teams must ensure their company adapts to these new regulations when operating in these regions.

According to Directive 2003/88/EC of the European Parliament, an employer is obliged to monitor the working time of their employees. Failing to provide documentary evidence of monitoring can have serious consequences. In France for instance if there is an inspection and there is no time tracking system in place, the labour inspectorate may fine a company up to 2,000 euros per affected employee.

Deutsche Bank recently faced repercussions in a dispute with the Spanish union CCOO. On 14 May 2019, the European Court of Justice ruled in favour of the union's demand for better monitoring of the daily working hours for the bank's employees. The bank was required to establish a time management system to improve oversight of overtime worked and compliance with break periods.

To meet this legal obligation, employers are responsible for providing proof of the daily and weekly working hours and rest periods of their employees, regardless of the method used: clocking terminals, spreadsheet entries, or time management software.

How can I track working hours in my company?

While some employers have an obligation - depending on the countries in which they operate - to establish an objective, reliable and accessible system, the form of the time and attendance monitoring or management solution remains entirely flexible.

Here is an overview of the different methods for monitoring working time.

The manual logbook

Working and rest hours are manually recorded by the employee in a paper log or an Excel file. Timesheets are typically signed by both the employee and their line manager. While this method is simple to implement, it has several drawbacks, starting with its lack of reliability (risk of errors, falsification or loss). Additionally, paper or spreadsheet management is not ideal for centralizing information and makes archiving more cumbersome.

The clocking terminal

A terminal is installed at the company (for example at the entrance, or in a break room) where employees present their unique identifier (a badge or card) to signal the start of each work or rest period. The recorded data is then reprocessed to calculate actual absences and overtime. This method is typically used at production sites, like factories, and office employees with fixed work schedules. However, it is not suitable for employees with an annual contract, nor those who travel frequently (like managers, sales staff) and those who work from home.

The TAM software

Time management software allows employees to submit their working hours with complete autonomy. Entries simplified with the pre-filled standard schedules, as well as leave and absence records. Managers review and approve the entries within TAM software. The data is recorded and archived for potential work inspections (depending on the location of your company) ensuring hours are accurately counted for payroll preparation. An alert system reminds employees to fill in their timesheets and informs managers and HR departments if rest periods are not observed.

The three advantages of time tracking software

Having a working time management tool is not only a legal requirement in some countries, but it is also an essential performance management tool that should be implemented within your company.

Centralize variable elements for payroll

A time management solution enables the calculation of overtime, night work, or work performed on public holidays, which simplifies the payroll administrator's task, of transmitting all variable payroll elements to the provider or integrating them into the payroll system.

Generate activity reports

For companies that need to justify the time spent on a project (such as consultants), time tracking management software can be used to produce detailed statements, which are crucial for creating invoices or comprehensive activity reports.

Meet operational needs

Finally, time and activity tracking addresses operational needs by focusing on the allocation of time spent per project. This allows for the assessment of employee workload and the initiation of strategic actions, such as discontinuing a time-consuming project; or making HR decisions like recruiting additional staff in cases of team overload.