Despite the advancements in technology, the construction industry is still one of the least digitized industries. Sure, many of the workers may be rocking the latest smartphones and their homes outfitted with the latest smart technology. But their workplace has not adapted. Why?
According to the JBKnowledge Construction Survey, nearly 50% of construction companies report spending 1% or less on technology annually. In an industry with thin profit margins, many are hesitant to make the jump to invest in technology when the current processes still provide them great success. The guiding advice to companies not ready to make the jump into technology is to NOT jump. Construction companies hesitant about technology should take baby steps with their technology adoption.
Time card software provides the lowest barrier to entry into digitization. Compared to construction management solution, time card software provides a relatively smaller investment with a large amount of cost savings. Below are some ways that time card software can save your construction company money:
When employees document hours on a paper time card, many habitually write eight hours a day reporting a 40-hour workweek. With time card software, employees punch in and punch out their time for more accurate time reporting. In this scenario, employees may work seven hours and 23 minutes one day reporting a workweek between 35-38 hours. Accurate time recording provides greater amount of labor savings to a construction firm.
The American Payroll Association estimates the average weekly overstating of time worked due to long lunches and breaks, tardiness, early departures etc amounts to 4 hours per employee per pay period. In a construction firm that employs 50 field workers at roughly $25 / hour, time card software would provide the firm a labor savings of $5,000 per pay period.
Annual savings: $120,000
Paper time cards require the payroll specialist to manually enter the time information into the payroll system. Illegible writing along with accidental data entry increases the risk of errors. Time card software minimizes the risk of errors by providing a digital time card. This results in the time information to be seamlessly transferred or imported into the payroll system.
The American Payroll Association estimates that clerical errors account for 1-8% of your payroll. In a construction firm that employs 50 field workers at roughly $25 / hour, time card software would save would save the firm 8% of their payroll for an error savings of $8,000 per pay period.
Annual savings: $192,000
FLSA Case savings
Wage and hour violations under the FLSA are skyrocketing. Paper time cards put the burden of proof on the employer to verify time cards and ensure the required hours include breaks and overtime. Time card software makes it super easy for employees to record breaks and overtime hours. Additionally, the office team receive alerts if an employee reaches overtime thresholds. Accurate and detailed time records from time card software provide strong documentation support in FLSA lawsuits.
Wage and hour dispute investigations collected more than $266 million in back wages for more than 280,000 workers. This amounts to approximately $950 per worker. Since many FLSA cases are class action lawsuits, in a construction firm that employs 50 field workers, time card software would provide an FLSA class action savings of $47,500.
Annual savings: $47,500
Think about all the paper and ink used to create your paper time cards. Whether you print them in house, outsource the printing to a printer, or purchase them, there is a lot of material used in paper time cards. It may not add up to a monumental savings compared to error and labor savings from time card software. However, every penny saved goes directly to your profits. Time card software eliminates the need for paper time cards to provide a digital solution with zero carbon footprint.
The American Payroll Association estimates that paper elimination results in saving of about .2% every payroll. In a construction firm that employs 50 field workers at roughly 25 / hour, time card software would provide a paper savings of $200 per pay period.
Annual savings: $4,800
Physical storage savings
According to the Fair Labor Standards Act, employers must preserve at least three years of payroll records. Depending on the number of employees at a company, paper time card storage can take up a lot of space. In addition to the space, the storage materials present an additional cost. Most importantly, paper storage runs the risk of being lost or damaged by theft or a natural disaster like a flood or fire.
Many time card software companies provide cloud-based access and unlimited storage for the life of the account. Time card software eliminates the need for additional office material such as folders and filing cabinets while creating an additional space for nice lounge or game area for employees while providing the critical digital record. A fire-resistant file cabinet from an office supply store averages $4000. Assuming only one file cabinet is needed to store time card information for 50 employees for three years, time card software would provide (at a minimum) physical storage savings of $4000.
Annual savings: $4000
For a construction firm the employs 50 field workers, an investment in time card software provides a potential annual savings of $200,800! While many construction firms may be hesitant to automate its processes and adopt technology, time card software is a must have. In conclusion, the financial savings along with productivity improvements that time card software brings will provide a great value and return on investment.