Page 105 - Essentials of Payroll: Management and Accounting

ESSENTIALS of Payr oll: Management and Accounting
projects will be completed. Also, be sure to carefully document all
benefit plan rules related to changes in the plans, so that employees are
not caught unawares; for example, many dental insurance plans only
cover the costs for major dental surgery if participants have already been
in the plan for at least one year; hence the computer system must alert

employees of this requirement before they switch to a different plan.

Cost:
Installation time:

Use Bar-Coded Time Clocks
The most labor-intensive task in the payroll area is calculating hours
worked for hourly employees. To do so, a payroll clerk must collect all
of the employee time cards for the most recently completed payroll
period, manually accumulate the hours listed on the cards, and discuss

missing or excessive hours with supervisors. This is a lengthy process
with a high error rate, due to the large percentage of missing start or
stop times on time cards. Any errors are usually found by employees as
soon as they are paid, resulting in possibly confrontational visits to the
payroll staff,from whom they demand an immediate adjustment to their
pay in the form of a manual check. These changes disrupt the payroll
department and introduce additional inefficiencies to the process.
The solution is to install a computerized time clock. This clock
requires an employee to swipe a uniquely identified card through a

reader installed on its side. The card is encoded with either a magnetic
strip or a bar code that contains the employee’s identification number.
Once the swipe occurs,the clock automatically stores the date and time,
and downloads this information upon request to the payroll depart-
ment’s computer, where special software automatically calculates the
hours worked and highlights any problems for additional research (such
as missed card swipes). Many of these clocks can be installed through a

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