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July 2, 2008

How Does Payroll Time Rounding Work

By Mark Nemtsas at 10:16 AM

A common question I get is how exactly does payroll time rounding work? So I thought it would be worthwhile to cover it in some more detail to help Time Clock MTS users.

How is Report Rounding Turned On?
You can turn on report rounding on the Tools->Options->Payroll Settings page. For more information take a look at the Time Clock MTS Payroll Settings help topic.

How Does Rounding Work?
Rounding is applied to time information at report time only. The rounding used is just normal arithmetic rounding. Here's an example, let's say we have the time rounding set to 15 minutes and the normal clock in time for your employees is 7:30 AM. In this example, anything on or before 7:37:29 AM is rounded down to 7:30 AM, and anything on or after 7:37:30 is rounded up to 7:45 AM.

What Does the Least Quantity Checkbox Do?
Checking this box over-rides the rounding scheme as shown above. The most basic way of explaining it is that all clock ins are ROUNDED UP and all clock outs are ROUNDED DOWN. So, in our example above any employee clocking in after 7:30:00 AM will have their time rounded up to 7:45:00 AM. Let's say the normal clock out time for the above example is 4:30:00 PM. When the Least Quantity check box is marked, any employee clocking out between 4:30:01 PM and 4:44:59 PM will have their clock out time rounded down to 4:30:00 PM. The practical effect of the Least Quantity check box is that the hours worked are minimized.

What Effect Does Rounding Have on Stored Time Information?
None, clock in and clock out data is still stored to the nearest second, the rounding takes effect when you run a report. In fact, you can now generate reports and suppress the rounding so you can view your raw time information. To do this all you need to do is check the Turn Off Rounding checkbox on the Report Configuration screen.

Why Would you use Time Rounding?
To comply with either your workplace payroll rules or government payroll regulations. A lot of workplaces have a minimum amount of payable overtime, so rounding can be easily used to prevent employees accumulating small amounts of overtime by clocking in slightly early, or clocking out slightly late. Another reason could be to allow for some leeway in clocking in or out, clearly not everyone can clock in exactly on time so time rounding allows for this. For example, Californian labor law allows for some leeway in rounding of time, allowing employers to not pay overtime for employees who clock in slightly early or out slightly late (provided they are not actually working of course). For more information on this take a look at the Department of Labor Website.

That about sums it all up, if you have any questions, as always post a comment or email us.


Or $199 (US) for 20 computers

Posted by mnemtsas at July 2, 2008 10:16 AM