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Fingerprint Timecards: Tracking Employee Time

How to Manage Employee Time

Written By: Judith Katz, President and CEO
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Managing employee time and attendance is a challenge for any business and especially so for those with hourly paid staff. Organizations in virtually every industry report that employees take extra time at lunch, roll in a bit late, or exit “just shy of 5 o’clock.” While a few minutes here and there may seem like no big deal, independent studies illustrate the true impact. According to surveys by global financial recruiter Robert Half International, the average employee steals 4.5 hours through time theft each week – the equivalent of a six week paid vacation for every employee, every year! Compounding the problem is a prevalent attitude among workers of feeling entitled to be paid for the hours they are scheduled rather than the actual number of hours they worked, a factor contributing to the high rate of fraudulent time-reporting. Clearly, any organization intent on managing the accuracy of its payroll must have a mechanism for reliably tracking employee arrivals and departures.

Electronic timeclocks and manually-compiled timesheets, once the most common time-tracking methods, are nearing obsolescence. With the universal computerization of business processes, companies large and small are converting from paper to digital systems, and time-tracking software is no exception. While features and capabilities vary from application to application, their common denominator is automation of the payroll process. By virtue of limiting human interaction, these systems dramatically reduce fraud, errors and inefficiencies, such as:

  • Eliminating data entry tasks,
  • Preventing timecard calculation errors,
  • Reducing fraudulent time-reporting,
  • Reducing unauthorized overtime,
  • Enforcing work schedules,
  • Documenting wage and hour compliance, and
  • Improving payroll accuracy

Knowing Who’s Who

Among today’s leading time-tracking applications a key differentiator is the type of data capture technologies they employ. This is the method a program utilizes to achieve user recognition or identification. Within this category there are four distinct methods:

Card-based: Otherwise known as swipe card systems, this technology utilizes plastic cards or badges with magnetic stripes or barcodes that embed coded information. Each code represents the identity of a particular individual (or item.) Magnetic stripe cards feature a strip of coated magnetic recording tape with three tracks of differentiated information affixed to the outside of the card. With barcode credentials, it’s a series of lines varying in width and distance from one another. In either case, special readers with laser beams sensitive to the reflected light of lines translate the codes into digital data for computers. For the purpose of time-tracking, employees punch-in and out by swiping their card through the terminal, authenticating the cardholder’s identity while also capturing the precise time of this transaction.

Direct-Entry: These are digital key-code systems that require users to enter personal identification numbers (PINs.) Like swipe cards, this method also assigns alphanumeric codes that correspond with identities of employees. The difference is that direct entry systems may be used with or without cards. Employees key their PIN numbers into a terminal, or as with the swipe-card approach, insert their cards into a scanner to read the coded data.

Radio Frequency Identification (RFID): Here, a microchip is embedded in an accessory, such as a card, badge or key fob, which transmits the unique information to a reader. Proximity systems come in two types: Those that require contact and those that are contactless. In contactless, a chip with an antenna enables the accessory to be waved at and read by the terminal from a distance. Contact systems are like other card systems, requiring direct contact with the reading device.

Biometric Recognition Technology: These systems rely on unique physiological or behavioral characteristics (such as fingerprints, voice and handwriting patterns) to identify individuals. In essence, these traits serve as the user’s credential or password. In doing so, they offer a better solution for organizations with increased security requirements than traditional identification methods such as passwords and PINs (personal identification numbers).

Regardless of the biometric trait used all recognition systems perform similarly. They begin by capturing an image of a physical trait and making a template that is stored in a digital file for comparison to newly entered data/samples. The objective is to achieve a match, thereby resolving a pattern recognition problem that separates two classes – forgeries and originals. As a solution to the challenges of authentication, its advantages are many: Convenient, impossible to share, forget or lose; and, with few exceptions, impossible to replicate –all contributing to their rating as the most secure data capture technology available.

The term biometric is derived from the Greek words "bios" for life and "metron" for measure. In IT applications, these unique characteristics are “measured” by a scanner or other sensing device for the purpose of verifying or authenticating identity. This technology is increasingly being integrated into computing environments to meet ever-changing security needs and deliver a business advantage. Among today’s most popular recognition technology programs are those that manage time and attendance, facility-access and computer-access. With employee time and attendance programs specifically, recognition software interfaces with a timecard program that captures an employee’s hours of arrival and departure while authenticating his/her identity. Well-received by business, industry and government, time-tracking solutions satisfy the needs of Main Street and enterprise businesses by simplifying and expediting business process tasks with unprecedented levels of reliability, security and accuracy.

Weighing-In: The Strengths and Weaknesses of Recognition Technology
           
Fingerprint “time-trackers” also provide management with an accurate, real-time accounting of employee hours, projects and/or job assignments. And, unlike conventional electronic punch-clocks or card-based systems that rely on barcodes, magnetic stripes, and PINs (personal identification numbers), biometric applications identify users, not accessories. As a result, they prevent employees from buddy-punching (clocking-in for tardy or absent co-workers). They also enable the compilation of data into management reports that aid in scheduling, overtime reductions, employee productivity, and the prevention of payroll disputes. An additional bonus with some applications is their interface with QuickBooks and other leading payroll and accounting packages. Programs that offer this feature enable payroll processing with exceptional speed and accuracy by eliminating the time-consuming administrative tasks and human errors that are so often part and parcel of preparing employee paychecks. And, as surveys commissioned by the American Payroll Association (APA) and others point out, these “little things” add up to big costs:

  • The manual calculation (adding and auditing) of employee time averages five administrative minutes per card. At 100 employees, an organization may lose a full, eight-hour work day to these unproductive administrative tasks.
  • The errors that occur in manual timecard calculation can account for as much as eight percent of a company’s gross annual payroll.
  • The US Chamber of Commerce estimates that tardiness, absenteism, extended breaks, incidents of buddy-punching, and other acts of time theft cost the nation’s businesses between two and five percent of their annual employee earnings.

With these points in mind, it’s no small wonder that biometrics are a booming business.

Biometric Characteristics – Good Traits or Bad

While the integration of recognition technology with business software applications is a relatively new development, law enforcement agencies have been utilizing it for decades. For years, fingerprint biometrics was standard in criminal investigations. Since the advent of computers and other progressive technologies, biometrics has moved from the sole method of fingerprinting to more than 10 types. Fingerprints continue to be among the most reliable and cost-effective, yet others, such as iris eye scan, retinal recognition, facial recognition, hand geometry, voice recognition, infrared imaging, keyboard dynamics and handwriting dynamics, have also entered the field. And like fingerprints, these biometric characteristics are now analyzed through sophisticated sensors and scanners. But biometric systems are not without their critics or flaws. The real difference lies in the human traits selected for analysis and just as every human has its flaws, so to does every biometric system.

Voice systems suffer problems with interference and background noise and some have proven susceptible to computer replicated voices. Retina and iris scans may be considered too intrusive or encounter objections to “laser beaming” the eyes.

Fingerprint equipment has a negative association with criminal activity and image quality can be adversely affected by a multitude of factors such as­ dirty, wet, dry, or cracked skin or even the way a user interacts with the scanner. But, the most common are concerns about invasions of privacy. Users have expressed concerns that their fingerprints may be recreated, duplicated or otherwise shared. Countering this, innovative developers encrypt data that is incompatible with Automated Fingerprint Identification Systems (AFIS), the worldwide standard of patented fingerprint matching technology (used by government and law enforcement.) However, recent findings demonstrate that education not only eradicates resistance, but results in high user acceptance and comfort levels. According to thousands of customers who utilize time-tracking solution Timecard Monitor, Count Me In, LLC’s fingerprint clock-in is well-received by workers at every level. People like its simplicity and efficiency and have full confidence in the security of the system. Most regard it as another welcome advancement, similar to direct deposit and other protective payroll-technologies.

Performance Criteria of Biometric Measurements

In meeting the twin demands of security and convenience, biometrics is rapidly becoming a favored data capture technology for identity authentication. The authentication process involves a one-to-one search: A live biometric presented by the user is compared to a stored sample, previously given by that individual during enrollment, and the match is confirmed. The fingerprint of the user is not stored in a database or on an ID card. Instead, a mathematical equation, or algorithm, is performed with points measured on the finger or hand. The template that results from this equation is all that is stored. When the user presents an ID card or enters an assigned PIN, only that template is transmitted. When the employee presents his or her hand or finger, the reader runs the authentication process to determine if the template that is stored matches the biometric being presented. If there is a match, the person is authenticated.

To emphasize, the authentication of the person has been previously established. The matching of the live biometric to the established stored sample is all that is necessary to authenticate the individual as an eligible user. No search takes place to match a user's data to a central database. Palm prints or fingerprints of the "Law and Order" type are never analyzed.

Systems that apply biometric technology do so in two ways: Identification and verification. With identification, the task is to determine who a person is by finding a match from a database. In cases where the database contains hundreds or even thousands of records, the “search” can take substantial time and processing power.  The second approach, verification, involves taking new input and comparing it to that individual’s original sample – which, when achieved, authenticates that the person is who he says he is.

Performance of a biometric measure is commonly referred to in terms of a false accept rate (FAR), a false non-match or reject rate (FRR), or a failure to enroll rate (FTE or FER). Yet, one of the most common measures of real-world biometric systems is the rate at which the setting equally accepts and rejects errors. The lower the equal error rate (EER) (also known as the cross-over error rate (CER)), the more accurate the system is considered. And overall, biometric systems are regarded as providing a very high degree of certainty and therefore, a very high rate of reliability.

Conclusion

While these technologies entered the marketplace with price points in the tens of thousands of dollars and with capabilities geared toward large enterprise operations, prices continue to decline. In fact, time-tracking applications with biometric terminals are accessible to almost any business in need of a reliable method of automated time-keeping. Of course, product costs vary, but companies targeting the small to mid-sized business market offer customized solutions designed to meet the budgets and needs of any size or type of organization – from those with as few as two employees to large enterprises, with multiple departments and facilities. Increasingly powerful components, features and capabilities, correspond with increasing price tags, but basic models that offer complete time and attendance functionality, can be purchased through some vendors starting as low as $400.

Organizations that use biometric time-tracking solutions report an immediate ROI achieved through dramatic improvements in employee punctuality, accountability, morale, and as a result, workforce productivity. The following chart can help you select a system best suited to the needs and budgets of your organization.

CONSIDER & EVALUATE

FEATURES & CAPABILITIES

The number of employees in your organization now and estimated count projected for growth over five years.

A system that provides scalability.

The number of locations to accommodate.

 

A system that offers scalability and networking capabilities for managing employees in more than one location and if so, whether it requires additional hardware.

The preferred methods of data collection.

Assess your company’s history of incidents involving employee time-theft, buddy-punching, rounding-up hours, or other acts of fraudulent time-reporting –   indicators that secure ID authentication methods should be considered.

The type of management information your company needs/wants to capture, measure or monitor, i.e., attendance, work schedules; productivity; switching of job roles; assignments, or worksite locations; sick/ personal/ vacation time, etc.

A system that generates management reports that enable effective decision-making and greater operational efficiencies. 

A system that can apply your payroll rules and policies.

The payroll and accounting software used by your
business or payroll service provider.

A system that seamlessly integrates with leading
financial management programs.

The need and duration of data storage and report development capabilities.

A system that archives and permits easy-access to data.

The need for supervisor/administrator approval.

A system that enables management to review, reconcile and edit data.

The technology “comfort level” of your employees
and administrative staff.

A system that is simple and user-friendly and that is backed by a reputable company with solid track records in customer support, training and software maintenance.

Judith Katz is president & CEO of Count Me In, LLC, an award-winning developer of workforce management software solutions. For more information about Timecard Monitor employee time and attendance software or any of Count Me In’s products, contact Judith at Judith@countmeinllc.com.

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