Payroll is more complicated in construction due to the nature of the industry itself. It’s common to have multiple projects in progress across sites or even state lines that require time tracking, and there are numerous labor regulations, like certified payroll, to take into account.
On top of that, many construction companies are still using manual payroll processes, which are inefficient. From paper timesheets to manual data entry, the process is more likely to result in errors and bottlenecks in the approval process.
Thankfully, you can make manual payroll a thing of the past. Time tracking and payroll tools digitize and automate many construction payroll processes. With the right tools, you can cut down on time-tracking errors and even reduce your payroll processing time by 70%.
Outdated manual payroll systems often don’t meet the demands of today’s construction companies, especially if they still rely on paper timesheets. Manual payroll processes are not only less efficient, but they also raise the risk of human error and compliance issues.
If your company uses paper timesheets to track hours worked at project sites, you risk more errors along the process for several reasons.
First, payroll administrators manually transfer data from the timesheets into digital spreadsheets or files. In this instance, it can be easy to transpose numbers or simply enter inaccurate data if handwriting is hard to decipher. Manual data entry is responsible for 35% of all payroll errors.
Second, paper timesheets can become misplaced, get lost, or be turned in late, causing delays and inaccuracies in the payroll process.
Field employees often work at multiple sites and may complete different construction tasks throughout the day. Additionally, they may work for a mixture of public works and commercial projects, which have varying pay rates and reporting requirements. Ensuring accurate pay rates and cost coding for numerous construction projects is extremely time-consuming and can be challenging to keep straight using manual methods.
Manual payroll processes are full of inefficiencies. You may face delays in getting information from the field, and it can take a significant amount of time to manually enter timesheet data into your system. Additionally, payroll administrators may have to manually hand over files in the approval process. A lot of time is lost completing repetitive administrative tasks that don’t add value to your construction company.
Construction companies face numerous industry regulations they must stay in compliance with or face penalties. Since manual payroll processes are less efficient and more error-prone, the risk of compliance-related issues is greater, especially regarding certified payroll, union regulations, prevailing wages, and overtime.
You can eliminate manual time tracking with the right tools. Digital time tracking tools allow you to collect critical time and project information from on-site workers in real time. These tools ensure both greater accuracy and speed up payroll processing. Here’s how:
Mobile time-tracking tools eliminate the need for paper timesheets. Whether you’re using on-site digital punch clocks or time-tracking apps, these tools allow field workers to clock in and out at each project site, and time is automatically entered into your system for approval.
Time tracking solutions can collect, code, and route timesheet data for you, so you won’t have to chase down missing timesheets or spend hours on repetitive data entry. These tools not only save time but also reduce the administrative burden on your payroll staff.
Instead of manually entering data and determining where to send it for approval, many time tracking tools can integrate with your accounting system and offer custom payroll workflows. Timesheet data automatically appears in your system and can quickly be routed to the right roles for approval based on projects.
Access to real-time data allows for greater transparency throughout the payroll process, helping you avoid errors and delays that impact compliance. Additionally, some tools offer customizable tracking and routing options so you can streamline each part of the process to align with your company’s exact needs, further ensuring your payroll is accurate and on time.
Now that you know how time-tracking tools can benefit your construction payroll process, here are the top features to look for.
Mobile capabilities allow your field employees to accurately record and code their time on their smartphone or tablet, even in remote areas without cellular reception. Data is saved in the app and automatically syncs when back in range. They’re also user-friendly, so workers can select their hours, correctly code their tasks, and send it for approval in just a few clicks. Many even have high-tech features that help prevent time theft, such as photo capture, GPS tagging, or geofencing to ensure time is tracked accurately.
It’s essential that the time tracking tool integrates with your existing accounting or enterprise resource planning (ERP) system. Seamless integration allows data to flow from the field into your back office in real time. It’s a must-have feature if you want to eliminate manual data entry, prevent duplicate data, and reduce errors. Time-tracking solutions like Remote Payroll offer seamless integration with top construction accounting software like Sage, ProCore, and Foundation, to name a few.
Automated routing and customizable workflows ensure your payroll data gets seen by the right people in the right order. This feature eliminates both manual time entry and manual approval from the payroll process to reduce processing time and bottlenecks while increasing accuracy. You can design approval paths based on your company’s structure or unique project needs so payroll data is routed directly to the right staffer.
Anchor 41, a California-based construction company, handles state and federally funded projects in addition to commercial and private construction work. Prior to working with hh2, Anchor 41 completed its payroll process manually.
Its two payroll employees ensured all timesheets were accounted for and accurate, which were often emailed or faxed to the office. On occasion, they would have to chase down a timesheet and wait for workers to deliver it before they could start the payroll process. Then, they had to manually transfer each job, cost code, and pay rate from the paper timesheets into a spreadsheet.
These factors often meant delays in turnaround time and rushing through the payroll process to ensure they met certified payroll deadlines. They also risked inaccuracies and compliance issues due to human error. In all, it would take them one to three days to process payroll each week. Seeking a better solution, Anchor 41 turned to hh2’s Remote Payroll.
By using hh2’s mobile time tracking app, Anchor 41 eliminated paper timesheets and manual data entry from its payroll process. Time worked comes into the system as it’s entered in the field, so the payroll team can quickly review it for approval on a rolling basis. Remote Payroll also streamlined their processing time. With the payroll tool fully integrated into their accounting system, the construction company now completes the certified payroll process in as little as 30 minutes.
If you’re ready to streamline your construction payroll process, consider hh2’s Remote Payroll. Our mobile time-tracking app and customizable payroll workflows are designed to meet the unique needs of the construction industry, reducing your processing time by 70% while increasing accuracy and ensuring compliance. Book a free demo to explore our time-tracking tools and learn more about our construction solutions.