subject: Keep Track Of Employee Hours [print this page] There are many aspects that need to be considered when running a successful business. One of the most important aspects is payroll and employee management. An employee is an investment. From the time of interviewing, hiring training and getting through the first 3 months of the probation period, it's costing the company money. On the other hand, employees are the backbone of our economy. You will get more bang for your buck if you reward your employees and allow them to put forth their ideas and work together as a team.
You can hire an hourly employee, salary or sub-contractor. An hourly employee will work under the company's guidelines, has a set start and finish time and has to report to management. The salary employee also works under the company's guideline but has flexible hours. Their wages are a monthly fixed amount regardless of the hours spent. They will report to the owner or board of directors of the company. A sub-contractor is an individual usually having their own small business and is hired to perform a short term task using their own tools and setting their own hours. They will invoice the business once the job has been completed to the owner's satisfaction.
The labour board has numerous employment laws, so it's not uncommon for employees to outsource their human resources for a fee. Outsourcing will involve payroll processing, source deduction calculation, WCB remittances, health benefit deductions, T4s and related government documents. An employer should have some idea of labour and employment laws. Ask WBC to visit your work place to insure the safety of your employees.
Small business owners have to withhold money from their employees such as income tax, Canada Pension Plan (CPP) and Employment Insurance (EI). In many cases family members would not be eligible to collect EI if they lost their jobs. If they can't collect, why pay the EI premiums. Ask your local government office if your family member qualifies. Same goes for a shareholder of an incorporated company. If the shareholder owns more than 49% of the voting shares, they should be exempt from EI as they will not be able to collect EI premiums.
There is an added cost to hiring employees, so make sure you estimate these costs when calculating how much to pay and employee. Consider your portion of CPP, EI, WCB, vacation pay and Statuary holidays. For every $1. of EI deducted from employees wages the company contributes 1.4%. CPP is matched dollar for dollar. There is a industry percentage for Workers Compensation Board (WCB) calculated on gross wages, there is 4% vacation pay paid on gross wages and there is statuary holiday which is an average days pay. So, if you hire someone at $16. per hour it does not end their. By the time the extras are calculated that employee is costing you close to $20. per hour.
Keeping track of employee's hours can be solved with time clock software, punch clock, or time cards and sheets. The time clock software will keep track of the hours automatically and on pay day give report on each employee and hours worked. The punch clock is mounted on the wall in a convenient spot for employees to use. They will simply insert the card in the clock and the start and finish hour is printed on the card. On pay day the cards are collected, hours are calculated manually and pay cheques are prepared. The cards and sheets are very old fashioned. The employees will record their own start and finish time on the cards or sheets. In some companies the supervisor will authorize the hours and the HR department will manually add the hours and pay the employees.
