Businesses go through this every week, every two weeks, every month, and believe it or not, a few businesses do this every day! The task consumes a ton of time, and you didn’t envision it in your dreams of business ownership. And your ability to grow your business is diminished by this task. It’s the task of processing payroll. I’m specifically referring to the head-pounding practice of using handwritten time cards and then converting time to calculate payroll hours.
Payroll companies require labor hours in a decimal format. Converting time from hours and minutes to the decimal format needed for payroll requires you to use a 60-base number, not the usual 100-based math that’s easy to understand. This conversion leads to costly errors.
For example, 5 hours and 35 minutes is not 5.35 hours. Do the math. 5.35 hours is actually 5 hours and 21 minutes. The calculation is .35 x 60 = 21 minutes or 21/60= .35.
I talked to a business owner recently who had an employee complain about her hours. She thought she was shorted. She was right. For example, on one shift, the employee worked 5 hours and 35 minutes, but the owner submitted 5.35 hours to the payroll company and did likewise for every shift for every employee for 2 weeks.
A common practice for admins who calculate handwritten time cards is to round hours (not recommended) so that converting time is easier. Know your state laws. This may not be legal.
To show this in the terms we know, let’s look at the basic time conversion (see the last row in the chart):
- 15 minutes is a quarter of an hour, .25
- 30 minutes is half of an hour, .50
- 45 minutes is three-quarters of an hour, .75
- 60 minutes is one hour, 1.00
Feel free to print the chart as a reference when you are faced with the challenge of converting time manually. If you are a business owner who must manually convert time for payroll hours calculations you might consider letting an online time card system do that for you. Chronotek can also calculate Overtime, even for semi-monthly and the special California Overtime rules. When a system does the work, it will not matter how often you do payroll, and the risk of error is greatly reduced. Free up your time. Eliminate your payroll headache and revitalize the business dream you once had. We believe that you will also save money when you stop using handwritten time cards and your employees are using our mobile time clock app.
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