The Timecard and Payroll Cutoff SOP

Purpose

Define how technician time gets captured, reviewed, approved, and locked before every payroll run. A standard operating procedure (SOP) is the written, repeatable process everyone follows the same way, so payroll is accurate regardless of who is running it that week. Time is the largest cost in most service shops, and it is the one most often captured on a guess. A timecard filled in from memory on Friday is wrong in both directions: hours the shop pays for that were not worked, and hours a tech worked that never got paid. A firm cutoff and a real review turn payroll from a weekly scramble into a checked, defensible process.

Scope

Applies to capturing and processing worked time for a pay period:

• Field labor time on jobs
• Non-job time: shop time, travel, training, meetings
• Overtime, and paid leave taken during the period

Excludes computing final pay rates, taxes, and deductions, which the payroll process handles after time is locked. This SOP ends at approved, locked time handed to payroll.

Roles and responsibilities

Procedure

Step 1: Capture time daily, not from memory

Time gets recorded as the day happens, clocked in and out against jobs, not reconstructed at week's end. Same-day entry is close to accurate; a Friday reconstruction is a guess that drifts against the shop every time. Each tech is responsible for their own daily entry.

Step 2: Account for all worked time, on the clock and off

The timecard has to reflect real worked time. Two errors to catch:

• Unrecorded work: time worked through a break, before clock-in, or after clock-out still has to be captured and paid. Off-the-clock work that is not recorded is a wage problem, not a favor to the shop.
• Time not worked: hours logged that do not match any job or activity get questioned before they are paid.

Step 3: Reconcile time to the work performed

The supervisor checks each tech's hours against the jobs they ran. Hours that do not tie to jobs, travel, or a known non-job activity get explained. A day showing far more or far less time than the jobs support is the flag: a missed clock-out that ran the clock overnight, or a job worked but never logged.

Step 4: Correct exceptions with the tech, before cutoff

Fix problems while the tech still remembers the day. Missing punches, a forgotten job, a wrong start time: resolve each with the tech and note what changed and why. A correction made after the fact with no note is the one that gets disputed. Never quietly edit a tech's time without telling them.

Step 5: Flag overtime and leave correctly

Confirm overtime is captured per the rules that apply to the shop and coded as overtime, not buried in straight time. Confirm any paid leave taken in the period is entered. Overtime rules and their thresholds vary by jurisdiction and by how the pay period is defined, so apply the standard that governs your shop rather than assuming one rule fits everywhere.

Step 6: Approve by the cutoff

The supervisor approves each tech's time by the hard cutoff. The cutoff is fixed and communicated: time not submitted by then is handled as a late exception, not by holding the whole payroll. A cutoff that slips every week is not a cutoff.

Step 7: Lock the period and hand off

Once approved, the period is locked so no one can edit it after the fact, and the locked time is handed to payroll. Locking protects the record: it is what you point to if a paid amount is ever questioned. A period that stays open after approval invites a quiet change that nobody catches.

Step 8: Handle late and corrected entries by exception

Time that arrives after the cutoff, or a correction found after the lock, is processed as a documented exception with a reason and an approval, typically on the next run. The exception path keeps the main process clean while still making the tech whole.

Records and retention

Keep timecards, approvals, corrections, and their reasons for the period required by wage-and-hour rules, commonly several years. Time records are the first thing requested in any wage dispute or audit, so they have to be complete and defensible.

Common timecard failures

• Time reconstructed at week's end. Wrong in both directions, every week.
• Off-the-clock work unrecorded. A wage-and-hour problem waiting to surface.
• Silent edits to a tech's time. Trust and accuracy both break.
• A cutoff that always slips. No discipline, and payroll is a scramble every period.

References

• Fair Labor Standards Act, 29 USC 201, on hours worked and overtime
• Department of Labor Wage and Hour Division guidance on recordkeeping
• IRS Publication 583, Starting a Business and Keeping Records
• See related: The Daily Payment Reconciliation SOP