• Employees must receive pay for all hours they work, but clocking in early or clocking out late does not mean workers must be paid for non-work time.
• “Rounding” timecards is permitted but must be applied evenly and consistently.

Time clocks

Time clocks are not required, but they are a common means to record hours worked. Whatever system is used, employers always bear the burden of ensuring that time worked was properly recorded.

Employers are required to pay employees for all hours worked. However, if employees punch in early (or punch out late) and are not actually working, they don’t have to be paid. Some employers will “round” a timecard in these cases, but there is a difference between rounding a timecard and simply disregarding “non-work” time. Applicable federal regulations are presented in this section, with unauthorized overtime addressed first.

For example, if an employee punches in 15 minutes early, then sits drinking coffee and chatting with coworkers, that employee is not “working” and doesn’t have to be paid for that time. However, if actually working, the worker must be paid, even if the employer didn’t authorize the overtime.

There isn’t any regulatory guidance on how to change the timecard, but the employee should be required to initial any changes. This will show the company did not change the timecard without the employee’s knowledge (which may look like an unlawful effort to avoid paying overtime). It will also show the company is aware the employee punched in without working. This is essentially an attempt to steal from the company (to receive pay without working). The employee can be disciplined for this, and it should help reduce future occurrences.

Although a rounding practice is permissible, it must be evenly and consistently applied. Employers cannot selectively round timecards to the detriment of the employee. For example, if rounding to the nearest 15-minute interval, the employer might use a “seven-minute rule” where any punch between 7:46 and 7:52 is rounded back to 7:45, and any punch between 7:53 and 7:59 is rounded up to 8:00.

Employees who punch in early and start working must be paid for their time based on the rounded starting time. The concept is that this will “average out” over time. Some days, an employee might punch in at 7:52 and get “extra” pay because the starting time is rounded back to 7:45. Other days, the employee might punch in at 7:53 and “lose” a few minutes because the starting time is rounded up to 8:00. It should average out over time.

As noted, however, this assumes the employee started working. There is a separate regulatory provision for “disregarding” time punches (and changing the timecard) if the employee arrives early (or stays late) but is not working.

In short, if employees arrive early (and start working), the employer has to consistently apply a rounding policy and pay them appropriately. If an employer does not want them arriving early, the rule against it must be enforced. However, if employees voluntarily arrive early and do not start working, that time can be disregarded or the time punch corrected. In such cases, an employer might explain that punching in without starting work is effectively stealing wages from the company. Once they are on the clock, employees need to be working.