What does good time tracking need to do - 6 criteria

1. Legal basis

First, the legal basis: it is the same for everyone in Germany, but in some cases it may call for additional features. The obligation to record working timeAt the top of the legal requirements is the obligation to record working time. The obligation declared by the Federal Labour Court (Bundesarbeitsgericht, BAG) in September 2022, that companies across Germany must record their employees' working hours, initially prescribes only this: to document and archive employees' working hours and therefore also their rest and break times. It rests on the employer's duty of care. Employers are obliged to ensure that their employees, and therefore their company, comply with the requirements of the German Working Hours Act (Arbeitszeitgesetz, ArbZG). What the recording of working hours has to look like is not prescribed by the BAG itself. You can find a closer look at the current legal situation here. The requirements of the European Court of JusticeThings look different when it comes to the requirements of the European Court of Justice, on which the Federal Labour Court's ruling is based. Back in May 2019 it obliged all European member states to pass a law on working time tracking. Even though that has not yet happened in Germany, the ECJ ruling lets us predict what such a law will look like: the ECJ prescribes that a time tracking system must be reliable, objectiveand accessible.

The obligation to record working time

At the top of the legal requirements is the obligation to record working time. The obligation declared by the Federal Labour Court in September 2022, that companies across Germany must record their employees' working hours, initially prescribes only this: to document and archive employees' working hours and therefore also their rest and break times.

It rests on the employer's duty of care. Employers are obliged to ensure that their employees, and therefore their company, comply with the requirements of the German Working Hours Act.

What the recording of working hours has to look like is not prescribed by the BAG itself.

The requirements of the European Court of Justice

Things look different when it comes to the requirements of the European Court of Justice, on which the Federal Labour Court's ruling is based. Back in May 2019 it obliged all European member states to pass a law on working time tracking. Even though that has not yet happened in Germany, the ECJ ruling lets us predict what such a law will look like:

The ECJ prescribes that a time tracking system must be reliable, objective and accessible.

The Federal Ministry of Labour's new draft law also has to meet these requirements. It is intended to create an obligation to record working time electronically, but first it has to be passed.

Impact on a time tracking system

Unfortunately, these ECJ requirements already rule out some time tracking solutions. Pen-and-paper records or an Excel spreadsheet in particular cannot keep up here. Instead, you should rather fall back on digital time tracking systems or a chip-based system.

2. Industry

Depending on whether you work in the skilled trades or the insurance sector, you may need different solutions. As a landscaping and gardening business you will most likely benefit from a mobile solution, whereas a dental practice will get by with a fixed terminal.

If you and your employees are out and about a lot and depend on being able to record working hours flexibly, we recommend digital time tracking via app that is also available offline. That way breaks can be recorded from the job site too, and you meet your duty of care as an employer.

For companies that do not depend on recording time in mobile form, chip readers can also work. Here time is recorded by checking in with chips. To do this, a terminal is installed at the workplace and every employee receives a chip or a card to check in and out with.

Another important factor is recording Sunday, public holiday and night work. Separate requirements for recording and changes to the German Working Hours Act apply here. A system should be able to recognise that and not create extra work for you. So if your employees also have to work at night, for example, look for a system that supports you in accounting for these special hours.

3. Company size

Not every system is designed for a company with several hundred employees. And not every company can afford an expensive tool. Depending on how big your company is and how many employees you have to record working hours for, the right solution for you may vary.

A small business with two or three employees may not need the big analytics tools and a great overview at all, because the recorded data is already fairly manageable in itself. There is no need to spend money on that. But do not forget: ideally your company will grow over time, and your tool should grow with you. So go for a flexible tool rather than having to switch again in a year's time.

For large companies, on the other hand, a cluttered tool with an unfriendly user interface can have devastating consequences. Quickly losing track and getting bogged down in red tape because of constantly recurring problems can cost not only time but a great deal of money. So here too, choose a tool that can cope with the size of your company.

4. Requirements

We have already talked about requirements on the industry side and on the basis of company size. But depending on how your day-to-day business runs, the right tool can vary here too.

If you work a lot with customer invoices based on the hours worked on a project, for example, project time tracking can be an important tool for you. Here employees record the time they spend on a project alongside their working hours. That way you can produce realistic customer invoices.

In the same way, the right tool can also take care of accounting for travel time for you. In mobile apps in particular, that takes just a few clicks.

One basic point, especially with digital time tracking, should be the administrative effort. When you trial a tool and roll it out in your company, it may well demand a little extra effort in the first few weeks. But if that stays constant and costs you valuable working time, you have not yet found the right tool for you. When it comes to workforce scheduling, absence management, resource planning, project planning and automatic digital timesheets in particular, the right tool can even take work off your hands.

5. Additional features

Does your company also work with other software such as DATEV, Lexoffice or others? Additional features such as integrations into the system can take a lot of extra work off your hands here.

And not only that: in project work in particular, the right system offers you the right additional features. Having all the important information to hand via app, communicating through an app and documenting the status of the project over the long term is what the digital project file makes possible. That saves you and your employees not only rummaging through disorganised files, but also plenty of phone calls, misunderstandings and delays caused by missing information.

6.Cost

Now the most important point: what does it cost me? Prices on the market vary widely. But that also depends on the type of system: if you go for a chip-based system, you face high up-front costs. Pen and paper or an Excel spreadsheet, by contrast, costs you almost nothing. But if you want to be on the safe side and not have to switch your time tracking system within a few months because it no longer meets the legal requirements, we advise against recording time by hand.

Looking at value for money, digital time tracking systems come out on top by some distance. Not only because these systems usually work on a subscription basis and so give you the option to switch flexibly, but because individual providers let you scale the system according to your headcount. So you pay for the number of employees you have. That makes the system considerably more flexible than a chip-based system.

On top of that, you can often trial solid digital tools for a certain period.