Does Time and Attendance Really Save 3–5% on Payroll? Let’s Look at the Numbers.

Does Time and Attendance Really Save 3–5% on Payroll? Let’s Look at the Numbers. 1. The Industry Claim The time and attendance industry often quotes payroll savings of 3–5% when a business moves from manual timesheets to an automated system. These savings are said to come from: Eliminating manual entry errors Reducing overpayment (from rounding, missed clock-outs, or “time theft”) Cutting payroll preparation time Improving visibility and accuracy across the workforce At first glance, this sounds optimistic — but even if we question those numbers, the logic behind them is solid. 2. How Those Savings Are Calculated Manual timesheets rely on estimates, memory, and manual data entry. Even small rounding errors (a few minutes per employee per day) quickly add up: 10 minutes overpaid per employee per day = 4 hours per month 50 employees × 4 hours = 200 paid hours that weren’t worked At $25/hour, that’s $5,000 a month — or $60,000 a year — in potential overpayment. Add to that the admin time saved by no longer typing, checking, or re-entering data for payroll, and it’s easy to see how systems that automate time capture deliver measurable returns. 3. The Reality Check That said, not every business will see savings as high as 3–5%. The true savings depend on how accurate the existing process already is, how employees are paid, and how well the new system is used. Some operations are already fairly tight, so a more realistic ongoing saving might be closer to 0.5% of total payroll. But even that smaller figure is still significant. 4. What 0.5% Means in Real Terms Let’s take a typical example: 50 employees Average earnings: $1,000 per week Total weekly payroll: $50,000 Annual payroll: $2.6 million A 0.5% improvement in payroll accuracy = $13,000 saved per year And that’s before you count the extra time freed up in payroll processing each pay period. So even if you only achieve one-tenth of the savings often claimed in the industry, the return on investment is still clear — your time and attendance system more than pays for itself. 5. The Takeaway Automated time and attendance isn’t just about convenience — it’s about control, accuracy, and confidence in your payroll. Whether your savings end up being 0.5% or 5%, you’ll spend less time fixing mistakes, pay only for the hours actually worked, and have a solid audit trail every pay run. Even modest efficiency gains add up to thousands of dollars every year — and that’s money better spent growing your business than correcting payroll errors. Would you like me to add a short intro paragraph that positions this as an Emptrak article (e.g. “At Emptrak, we often get asked whether time and attendance really saves money…”)?