Time rounding
Time rounding adjusts recorded clock-in and clock-out times to a set increment, such as the nearest quarter hour, before hours are totaled for pay.
- LAW
- 29 CFR §785.48(b), under the FLSA
- BOUNDARY
- Full pay for all time worked, over time
- INCREMENTS
- Nearest 5 minutes, tenth, or quarter hour
- WATCH FOR
- Rounding that consistently favors you
For enforcement, the Labor Department accepts rounding punches to the nearest 5 minutes, tenth of an hour, or quarter hour. The condition is that, over time, employees are fully paid for all the time they actually work. Rounding that consistently favors you fails that condition. State law can be stricter. Rounding belongs to a family of automatic time rules, with minimum shift rules, grace periods, and automatic break deductions. Each one can materially change paid hours.
How does nearest-increment rounding work?
A rounded punch moves to the closest increment mark, forward or back. Under quarter-hour rounding, punches 1-7 minutes past a mark round back, and 8-14 minutes past round forward. Neutral rounding moves some punches in the employee’s favor and some against, so paid time should average out.
| PUNCH | ROUNDED TO | EFFECT ON PAID TIME |
|---|---|---|
| Clock in at 7:53 | 8:00 | 7 minutes less |
| Clock in at 8:07 | 8:00 | 7 minutes more |
| Clock out at 4:52 | 4:45 | 7 minutes less |
| Clock out at 4:53 | 5:00 | 7 minutes more |
When does rounding fail?
Rounding fails the federal rule when, over a period of time, it leaves employees unpaid for time they actually worked. A rule that always rounds down is treated differently from nearest-increment rounding. State law can be stricter than the federal rule, so check each state before relying on rounding.
What evidence should sit behind a rounding rule?
Keep seven things on record for every automatic time rule. They are the stated rule, its population, its effective date, the input event, the adjusted result, the reason, and the audit evidence. Rounding is opaque when the employee sees a paid total with no way to trace it to the punches. Let employees view recorded punches, manager edits, and timecard totals beside the paid result. Test a rule against real schedules before production, then review its cumulative effect over several months.
Frequently asked
- 29 CFR §785.48, Use of time clocks
- 29 CFR §785.47, Where records show insubstantial or insignificant periods of time
- 29 CFR §785.13, Duty of management
- U.S. Department of Labor, Fact Sheet #22: Hours Worked Under the Fair Labor Standards Act (FLSA)
General information, not legal or tax advice. Apply current federal and state rules with qualified guidance.