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A Q&A About Automating Time & Labour Management

09/07/2013


Eben Louw, CA of MNP recently asked Richard Dobal, Product Manager at Automatic Data Processing (ADP) about the services they deliver to companies in the manufacturing sector. Specifically, we wanted to know about automated time and labour systems. ADP was selected as it is one of the world’s largest providers of business outsourcing solutions. They pay 1 in 4 Canadians in the private sector and are one of the leading providers of employer services in Canada.

Q. How does a time and labour management system help the supervisor monitor employee time and build efficiencies?

A. Research studies show that automated systems reduce labour costs by as much as 3.5% of a company’s total payroll and save each manager an average of 40 min/week. With a Time and Labour system, your data is LIVE and can be reported on at any time (no need to wait until the end of the pay cycle).

Q. How do the employees on the shop floor use the system?

A. Employees can scan IN/OUT with swipe cards or use their hands to scan with biometric terminal options.

Q. Describe the pros and cons of the different time collection devices: touch screen, swipe card, hand recognition.

A. The advantage of a biometric terminal is it only takes seconds to clock IN/OUT and completely eliminates any possibility for ‘time theft’ or ‘buddy punching’ as each employee must be present to punch. The primary disadvantage is there are some environments that are not suited for biometric devices such as environments with high dust, abrasive chemicals or vibration.

The advantage of a touch screen terminal is it can present more information on the large color display to both employees and supervisors. The disadvantage is that it is best suited for a clean or white collar environment.

If time theft is not a concern, the best terminal for manufacturing environments is a swipe card terminal. The most reliable type of swipe card device is a Proximity card terminal. The advantage being there is no physical contact (ie. swiping a card through a slot) required, an employee simply waves their card in front of the terminal. Additionally, they are sealed units making them the best choice for dusty environments. The primary disadvantages are the additional cost of swipe cards and the risk of employees forgetting or losing them.

Q. How does the information integrate to costing and the GL system?

A. Providing that interfacing is available with the other systems, custom work can be performed to map and interface according to company specific requirements. This interface can be direct to database if available in the other systems or can be via flat file to a secured network location.

Q. Is it helpful in job/project costing?

A. Time and labour systems provide immediate visibility into what is happening in production. By not having to wait until payroll is run to understand labour costs, corrective decisions can be made real time to keep a manufacturer competitive. Specific benefits include:

  • Employees, Supervisors and/or Administrators can allocate hours to multiple levels of labour charge fields, including department, location, job, product, project, etc.
  • Costing reports can be run at any time to identify gaps or inefficiencies and can be corrected immediately.
  • Employees can help management track allocation of labour and associated costs by recording labour charges using the same terminals. All captured time is automatically fed into the system and can be reported on immediately.

Q. What services can the employee use in regard to reports and benefit information?

A. From any PC with an internet connection, employees can view their schedule, view absence balances (i.e. vacation, sick, etc.) and request time off (i.e. book vacation). The requested time is automatically added to their schedule and reduces time off balances once approved. This can significantly reduce the administrative burden on managers.

There is also a mobile solution that includes this functionality, further helping engage and empower employees.

Q. Does it integrate with manufacturing at more than one location?

A. Yes. A benefit of web-hosted time and labour systems is accessibility to the database from any location. This allows a business the flexibility to have a single source for employee data, share employees between locations, allocate labour costs appropriately, provide a view to all locations/departments and provide one source for payroll and reporting.

Q. What types of custom reports can be created?

A. Based on the feedback provided by clients over the years, ADP has created and included numerous reports with configurable parameters that satisfy most company reporting requirements without the need for any custom reporting. If however a custom report is required, users have the ability to modify existing reports or create their own custom reports using fields and data from their database. These custom reports can be made public or kept private and can also be scheduled to run.

Q. What are the costs and typical complexities of implementations?

A. Costs are determined by the number of employees within the system. This provides companies of all sizes the benefit of the full suite of functionality in a scalable and fairly priced package based on economies of scale. An ADP representative reviews client requirements and based on needs, offers the right system to maximize ROI.

To simplify implementation, a dedicated implementation specialist works with each client to identify business rules and configures the system according to identified operational needs. Once configured, the implementation specialist guides the client through the workflow, including parallel runs to ensure accuracy and finally a payroll export to wrap up the implementation.

Q. How do these systems increase productivity, reduce cost and/or improve data?

A. By automating manual tasks and calculations associated with the calculation of employee time, companies gain immediate and consistent application of business rules, legislative compliance and accuracy. Let’s face it, manual tasks are not only time consuming, they are also prone to human error (illegible print on timesheets, transposition errors, calculation errors, and ultimately storage concerns to meet record retention policies).

When data capture and calculation is automated, timely and accurate, management can focus less on administration (saving time and money) and more on strategy to maximize productivity.

Q. What client needs typically lead to the implementations?

A. The 4 most common needs that lead to implementing a time and labour system include:

  1. Desire to automate manual tasks related to time capture and calculation of employee time (including overtime, premiums, labour costing, stat holiday qualification and payment, etc…) to minimize administrative burden, increase accuracy, consistency and maximize compliance
  2. Quick access to real time reporting in order to make the right decision at the right time
  3. Desire to consolidate employee data into one system instead of maintaining separate systems, files and spreadsheets
  4. Resolve a suspected employee time theft concern

Q. Does it work with US payroll on a state or federal level?

A. ADP offers Time and Labour systems in Canada, the US, and around the world that meet the needs of employers in each of their jurisdictions.

Q. If someone has questions about automated time and labour management or about ADP, who can they contact?

A. Kim Sorensen CMA is the Accounting Channel Executive for ADP and can be contacted at 604.412.5059 or [email protected]

For more information about ADP, visit their website at http://www.adp.ca. 

For more information about MNP’s Manufacturing Services, contact one of our Manufacturing Services advisors:

Eben Louw, CA, 604.870.7413, [email protected]
Susan Payment, CGA, 778.571.3524, [email protected]
Peter Dombowsky, CA, 604.393.3419, [email protected]


About ADP

Leveraging more than 60 years of experience, ADP offers a single source for a wide range of comprehensive services for:

  • Human Capital Management
  • Payroll
  • Time and Labour Management
  • Talent Management
  • Group Benefits Administration
  • Occupational Health and Safety
  • Comprehensive Outsourcing

ADP Canada Co. develops innovative products and services to help its 45,000 clients stay focused on what matters in their business. ADP Canada is an active member of The Canadian Payroll Association (CPA), the Human Resources Professionals Association (HRPA) and The International Association for Human Resource Information Management (IHRIM).