Report time: how the process runs, step by step

Time reporting runs from policy to payment. Payroll or HR sets the rules, employees record hours, supervisors approve them, payroll checks leave and overtime, and finance turns the approved hours into labor cost and utilization reports. Each handoff is a place where hours can go missing or get counted twice.

The steps in order

1. Set the time and leave rules. HR owns this, with payroll and employment counsel weighing in. The policy defines what counts as time worked and how rounding works. It also decides who is eligible for overtime, which leave types exist and who may approve what. A clear cutoff for submitting hours belongs here too.

1. Build those rules into the timekeeping system. The HR systems administrator sets up pay codes, schedules, accrual rules and approval routes. When a policy changes and the configuration does not, the system quietly enforces the old version.

1. Record hours worked. Each employee does this, through a clock, a timesheet or an app. Salaried staff often report only exceptions such as absence. Anyone whose time is billed or charged to a project also enters a charge code, and those codes matter later.

1. Request leave ahead of time. The employee submits the request and the line manager accepts or declines it. Approved leave should land on the timesheet automatically. Where it has to be retyped, mismatches follow.

1. Review and approve the timesheet. The supervisor compares submitted hours against the schedule and what actually happened on the floor or in the project. Approval is a statement that the hours are true. In practice many managers approve in bulk at the last minute.

1. Monitor regular, overtime and other hours. Payroll runs exception reports before the cutoff. Typical flags include missing punches, overtime nobody authorized, shift premiums applied to the wrong people and hours that exceed policy limits. Payroll chases the manager, not the employee, for a fix.

1. Analyze paid and unpaid leave. Payroll confirms that leave taken matches balances and that unpaid absence reduces pay. HR may review patterns such as repeated short absences. Finance needs the accrued leave balance because it is a liability on the books.

1. Lock the period. At cutoff, payroll freezes the data. Anything submitted afterward becomes an adjustment in a later run, and someone has to track it so it is not lost.

1. Feed approved hours into the pay calculation. Payroll imports the locked data and checks totals against the prior run. Large swings get questioned before anyone is paid.

1. Distribute labor cost. Cost accounting or the finance team spreads the hours and their cost across cost centers and projects using the charge codes from step three. Wrong codes here mean wrong project margins and, in some settings, wrong customer bills.

1. Report utilization. Operations managers or a finance analyst compare hours charged to productive work against hours available. The report shapes staffing and pricing decisions, so the people reading it should know how the underlying hours were captured.

1. Feed the forecast. Overtime trends and leave liability go to whoever prepares cash projections, because payroll is usually the largest predictable outflow.

1. Audit the records. Internal audit or the payroll lead samples timesheets against approvals and pay. Findings loop back to step one or step two.

Where it tends to break

Most failures sit between steps, not inside them. A policy says overtime needs advance approval, yet the system has no field to capture it. Managers approve without looking. Leave approved in one tool never reaches the timesheet in another.

Charge codes are a quieter problem. Employees pick whatever code is first in the dropdown, and nobody downstream notices until a project looks oddly cheap.

Late corrections deserve attention as well. If adjustments are handled by email and memory, they eventually go missing.

Questions to ask the people who run it

The documented process and the lived one rarely match. These questions tend to surface the difference.

• When a timesheet is missing at cutoff, what actually happens? Does someone estimate the hours?
• Who fixes a wrong punch, and in which system?
• How do managers decide what to approve? Do they check anything?
• Is there overtime that never gets formally authorized but is paid anyway?
• Where does leave live, and does it ever need to be keyed twice?
• Which charge codes do employees misuse most, and why?
• How are late corrections tracked between runs?
• Which reports does finance rebuild by hand because the system output is wrong?
• What workarounds exist for night shifts, remote staff or people who split time across sites?
• When a policy changed recently, how long did it take for the system to reflect it, and who noticed the gap?
• Who reads the utilization report, and what do they do with it?

Ask the same question of payroll, of a supervisor and of an employee. Where the answers differ, the real process is somewhere in between, and that is where change has to start.

APQC's Process Classification Framework® (PCF) is an open standard developed by APQC, a nonprofit that promotes benchmarking and best practices worldwide. To download the full PCF or to view definitions and measures, please visit www.apqc.org/pcf.