10 reasons why digital time tracking is better than electronic time tracking

Why do we need electronic time tracking?

In April 2023, Federal Minister of Labour Hubertus Heil presented the federal government with a draft law on electronic time tracking. It is the first step towards a law on working time tracking and is based on a 2019 ruling by the European Court of Justice. Back then the ECJ ruled that all European member states must pass a law on working time tracking. To this day that has not happened in Germany.

What is the difference between electronic and digital time tracking?

The biggest difference between digital and electronic time tracking is the device used to record the hours: with the electronic version this is usually an external device installed in the office – the so-called terminal. Employee data is recorded and stored there using personalised chip cards. So to clock in in the morning, employees have to hold their card or chip up to this device. They clock out the same way at the end of the working day.

With digital time tracking there is no extra device to install beforehand. Clocking in happens via an app, which can be downloaded onto any smartphone or tablet. Whether centrally on a tablet in the office or on employees' own phones, in the morning you can clock in with one tap and clock out again in the evening.

In purely legal terms that puts digital time tracking into the category of “electronic time tracking” as well, but the two can be told apart clearly. In the case of digital time tracking you could therefore also speak of “electronic time tracking with digital tools”.

10 reasons for digital rather than electronic time tracking

As similar as these two solutions may sound, they are just as different. We want to give you 10 reasons why we recommend introducing a digital system over a purely electronic one:

1. Mobility

The big difference between electronic and digital time tracking is the end device: the electronic version needs a fixed terminal you clock in at with a chip device; the digital version needs no separate device at all. Because a mobile device is enough here, it offers far more mobility.

With digital time tracking, hours can therefore be recorded not only from the office, but also from a home office, on business trips and errands, or from a customer appointment.

2. Cost

Electronic time tracking is an external system. The purchase costs are usually high. On top of that comes the reader that has to be installed. Every employee also gets their own card or chip, which again means cost.

With digital time tracking we are talking about nothing more than an app installed on a smartphone. Admins get separate access to a dashboard in the browser. That means there is no extra money to spend on expensive software here either. Instead these programmes work on a subscription model. You pay per employee, per month or per year, and that usually works out considerably cheaper.

3. Maintenance & repairs

Another point is maintenance and repairs when devices or systems break down. Electronic time tracking can be very expensive here, because external specialists have to carry out repairs on site at the device.

If something in your digital time tracking system does not work, you contact customer service and do not have to wait for external specialists.

4. Risk of loss

Electronic time tracking involves not only the permanently installed terminals, but the chip cards too. Every employee gets a personal chip card that is used to record the data. These cards can not only break, they can also be mislaid. And buying new chip cards can be expensive, and depending on the provider it can also create a lot of administrative work.

5. Flexibility of the system

The big advantage of digital time tracking, though, has nothing to do with devices and cost: digital time tracking grows with your business. That means you do not have to go looking for a new system in two or three years because it can no longer keep up with the size of your business, no longer pays off for you, or simply becomes too cumbersome.

Instead, digital time tracking works in a very modular way, adapts to the size of your business and is flexible. With a few clicks you can add new employees and get going straight away.

6. Range of features

But flexibility is not exhausted with the point above: digital systems usually let you do far more than just track time. Most of them offer further features, such as absence management and automatic digital timesheets. That means employees request vacation days and submit sick leave notifications through the app instead of on paper. At the end of the month the admin gets a finished timesheet for each employee and saves themselves a lot of work.

Digital systems can be carried over into further areas as well. With a digital time tracking system, working hours can also be assigned to different projects, travel time can be recorded, and projects can be documented digitally in a digital project file.

Electronic time tracking, by contrast, usually only offers the option of recording working hours and perhaps producing a timesheet at the end of the month.

7. Transparency

But time tracking does not only have to bring advantages on the employer's side. The digital solution also opens up new options for employees. Using the app, they can view the hours they have worked at any time. That creates transparency for both sides and can lead to a more relaxed working atmosphere in the business.

That feature is not always available with electronic time tracking. The law says that authorised people must have access to these files, but that can also happen only on request. That is not just a hurdle, it may also create uncertainty among employees.

8. Employee self-service

Transparency gives employees the chance to  take on administrative tasks themselves, or at least do the groundwork without much effort. Depending on how permissions are assigned, employees can for example make corrections to their recorded hours themselves, certificates of incapacity for work are uploaded digitally straight with the sick leave notification, and vacation can be requested well in advance.

These features create a new kind of communication within the business. They banish paper and pen, and with it perhaps the arguments about lost documents or the stress at admin level.

9. More modern & more future-proof

That makes digital time tracking more than just a way of staying compliant with the law. It lets your business take an important step: a step into digitalization. Because we live in a globalised world. The market keeps getting bigger and the competition is international. As a business you have to hold your own in that. And that only works if you stay in tune with the times, try out new technologies and dare to take the step into the unknown.

Electronic time tracking may look like the easier step at first, but in the long run it will turn out to be cumbersome. That is why it is worth investing the time now.

10. Staying more attractive as an employer

But being modern does not only mean standing out from the competition in the market. In times of a skilled labor shortage in particular, it is important to present yourself as an attractive employer. Cumbersome systems and external devices will not get you far there.

The young generation grew up with a phone in their hand and will quickly ask you why time tracking is not simply handled through an app. For them it is not even a question.

With the right solution, though, you do not only make yourself attractive to young people on the job market. Modern working processes also show that you as a business owner think along, are flexible rather than set in your ways, and are open to change and modern development.

The right solution for your business

As you can see, there are many arguments for choosing digital time tracking over electronic. Not only the adaptability of the digital solution, but all the extra features too, mean your business can do more than solve the problem of time tracking.

Looking at time tracking in particular, it can make sense to change perspective and look a little further – beyond the purely electronic solution to the digital one.

And we can help you find the right provider too, because with clockin you have everything you need to get started with digital time tracking: a user-friendly, practical app built to make your day-to-day work easier. clockin gives you the chance not only to digitalize time tracking, but to go further and make administrative processes in your business more modern, more effective and simpler.

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