Rounding Time Sheets using the 7-Minute Rule

Are you rounding your employees’ time sheets to make payroll easier, prevent early clock-ins, or even boost employee pay? It’s essential to accurately and legally round time clock punches to protect yourself and your business.

Rounding Rules to Keep In Mind When Changing Timesheets

1 - Rounded timesheets cannot benefit the employer

Any adjustments made to the timesheet cannot be a means for the employer to save money. For example, if an employer saw a timesheet with a start time of 8:03 and then rounded it to 8:15, the employer would save almost a quarter hour’s pay, even though the employee worked most of the quarter hour and should be compensated accordingly. Be careful with time card manipulation. The FLSA requires that employers pay for all the time employees work. 

2 - Follow the 7-Minute Rule

According to the Department of Labor, “Employee time from 1 to 7 minutes may be rounded down, and thus not counted as hours worked, but employee time from 8 to 14 minutes must be rounded up and counted as a quarter hour of work time.”  If you want to double-check your timesheet rounding, the chart below breaks down how to round time sheets to the nearest 15-minute mark.

3 - You cannot round in increments greater than 15 minutes

While it’s common to round time sheets to the nearest quarter hour, employers can also round by the 1/10 of an hour (6 minutes) or by 5 minutes. Remember that employers cannot round in increments greater than 15 minutes.

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