What Is a Timesheet? Everything You Need to Know
A timesheet is one of the most fundamental documents in running a business with employees, yet it is also one of the most misunderstood and most poorly implemented. Most business owners know they need timesheets. Far fewer know exactly what a good timesheet captures, what the law actually requires, what gets overlooked in practice, and what separates a timesheet that protects the business from one that creates problems.
This guide covers all of it, from the basics through the requirements, common pitfalls, and what to look for in a timesheet system that actually works, with a free weekly timesheet calculator at the end.
What Is a Timesheet?
A timesheet is a record of the hours an employee works during a given pay period. At its most basic level it captures when an employee started work, when they stopped, and the total hours for the period.
In a well-built system it captures significantly more: break times, overtime hours, the specific projects or job codes the hours were worked against, whether those hours are billable to a client, and a manager approval record.
Timesheets serve four core business functions.
| Function | What the timesheet does |
|---|---|
| Payroll accuracy | Employees get paid for exactly the hours they worked, including correct overtime. |
| Client billing | Service businesses need project-level hour records to bill clients accurately and defend those invoices. |
| Labor cost tracking | Knowing how many hours went into each project tells you whether that project was profitable. |
| Legal compliance | Federal and state law require employers to keep accurate time records for non-exempt employees. |
What a Timesheet Must Include
There is a meaningful difference between a timesheet that technically exists and one that actually does its job. Here is what every timesheet should capture.
Employee Information
Every timesheet entry needs to be tied to a specific person. This sounds obvious but paper-based and basic spreadsheet systems often have entries with no clear owner, making audits and disputes impossible to resolve. The timesheet should include the employee's full name, employee ID if applicable, and their department or role.
Pay Period Dates
The timesheet must clearly identify which pay period it covers. Whether your pay cycle is weekly, biweekly, or semi-monthly, the start and end dates of the period need to be on every timesheet. This is required for payroll records and becomes critical if a wage dispute arises.
Daily Clock-In and Clock-Out Times
Total hours alone are not enough. The timesheet should record the actual start and end time for each workday. This allows verification of overtime calculation, confirms break compliance, and creates an auditable trail. A timesheet that only shows "8 hours" for a day gives you nothing to work with if that entry is disputed.
Break Times
This is one of the most commonly skipped fields and one of the most legally significant. Some states have their own break requirements for shifts over a certain length, and federal rules treat short rest breaks as paid work time. If your timesheet does not capture breaks, you cannot prove compliance if an employee files a wage claim.
Break start and end times, or at minimum the total break duration per shift, should be recorded on every timesheet.
Regular vs Overtime Hours
Regular and overtime hours must be tracked separately. Federal law requires overtime to be paid at 1.5 times the regular rate for any hours over 40 in a workweek. Some states have daily overtime rules on top of that. A timesheet that does not separate regular from overtime hours makes correct payroll calculation impossible without additional manual work.
Project or Job Codes
For any business that bills clients, tracks project profitability, or wants to understand where labor is actually going, hours need to be allocated to specific projects, jobs, or cost centers. This is the field most businesses skip on basic timesheets and most regret later. Without project-level hours, you cannot produce an accurate client invoice, calculate project margins, or understand your true labor costs per job.
Billable vs Non-Billable Designation
Not all hours on a project are billable to a client. Travel time, internal meetings, administrative work, and rework may be non-billable. A timesheet that does not distinguish between billable and non-billable hours forces you to manually sort through entries at invoice time, which is both slow and error-prone.
Manager Approval
Every timesheet should have a documented approval step. Whether that is a physical signature or a digital confirmation, manager approval creates accountability on both sides. It establishes that the hours were reviewed before payroll was run and gives the business a defense if an employee later claims their hours were changed without consent.
Timesheet Completeness Checklist
| Field | Why it is there |
|---|---|
| Employee name and ID | Ties every hour to one person |
| Pay period start and end dates | Required for payroll records |
| Daily clock-in and clock-out times | Verifies hours and overtime |
| Break start and end times, or total break duration | Proves break compliance |
| Regular and overtime hours tracked separately | Makes payroll calculation correct |
| Project or job code for each entry | Supports billing and job costing |
| Billable vs non-billable designation | Speeds up invoicing |
| Manager approval with date | Shows hours were reviewed before payroll |
| Employee signature or digital confirmation | Shows the employee agreed with the record |
Legal Requirements for Timesheets
The Fair Labor Standards Act requires employers to keep accurate records of hours worked for all non-exempt employees. It does not prescribe a specific format, but the Department of Labor’s recordkeeping fact sheet spells out what data must be captured and how long records must be kept.
| Under the FLSA, employers must record | Retention |
|---|---|
| Hours worked each workday and total hours each workweek | Payroll records: at least 3 years |
| The basis on which wages are paid (hourly rate, piece rate, and so on) | Payroll records: at least 3 years |
| Regular hourly pay rate | Payroll records: at least 3 years |
| Total daily or weekly straight-time earnings | Payroll records: at least 3 years |
| Total overtime earnings for the workweek | Payroll records: at least 3 years |
| Total wages paid each pay period | Payroll records: at least 3 years |
| Time cards and work schedules | At least 2 years |
State law matters too. Many states have stricter recordkeeping rules than federal law, including longer retention periods, specific break documentation, and daily overtime rules. Review the rules in each state where you have employees, ideally with an employment attorney.
Common Timesheet Pitfalls
Even businesses that have a timesheet process in place make mistakes that create payroll errors, compliance gaps, and billing problems. These are the most common ones.
Rounding Errors That Compound Over Time
Many businesses round clock-in and clock-out times to the nearest quarter hour. Federal rules (29 CFR 785.48) allow rounding as long as it averages out over time and does not consistently favor the employer. The problem is that most manual rounding systems are inconsistent.
An employee clocking in at 8:07 gets rounded to 8:00 in one manager’s system and to 8:15 in another’s. Over a year, these inconsistencies either underpay employees, which is a wage liability, or overpay them, which is a direct cost.
Not Tracking Breaks Separately
Many timesheets record clock-in and clock-out but not breaks. This creates two problems. First, break compliance is impossible to verify. Second, employees are often paid for break time that should be unpaid, or not paid for short breaks that should be compensated.
According to the Department of Labor, rest periods of short duration, usually 20 minutes or less, are customarily paid as working time, while bona fide meal periods, typically 30 minutes or more, generally need not be paid if the employee is completely relieved of duties.
Approving Timesheets Without Reviewing Them
Manager approval becomes meaningless when it is treated as a rubber stamp. Managers who click approve on every timesheet without reviewing the underlying entries are not catching errors, are not identifying unusual patterns, and are not protecting the business. Approval should involve actually looking at the hours against the schedule and flagging anything that does not match.
Using Spreadsheets for Growing Teams
Spreadsheet timesheets work for a solo operator or two-person team. They stop working reliably at five or more employees. Formula errors, version control problems, manual data entry mistakes, and the inability to verify who entered what make spreadsheet timesheets a compliance and payroll risk as teams grow. The number of payroll errors traceable back to manual spreadsheet entry is consistently underestimated by small business owners.
No Submission Deadline
Without a firm deadline for timesheet submission before payroll runs, payroll becomes dependent on chasing down employees for missing time entries. This delays payroll, creates estimation errors, and results in corrections on future pay periods that create confusion. Every business needs a non-negotiable cutoff time for timesheet submission and a system that reminds employees automatically.
Missing Project-Level Data
This is the most expensive oversight for service businesses. When timesheets only capture total hours without tying them to projects, the business cannot produce accurate client invoices, cannot calculate which projects were profitable, and cannot make informed decisions about staffing. Many businesses discover this gap only when a client disputes an invoice and they have no project-hour records to support their billing.
Things Businesses Consistently Overlook on Timesheets
Beyond the common mistakes, there are things that almost never make it onto basic timesheets but should.
Travel Time
For employees who travel between job sites, travel time is often compensable under federal and state law. Whether commute time counts, whether driving to a first job site counts, and whether travel between sites during the day must be paid all have specific legal answers that vary by circumstance.
If your timesheets do not capture travel time as a separate category, you are either underpaying employees or unable to verify you are not.
On-Call and Waiting Time
Employees who are required to remain on-call in a way that significantly restricts their activities may be entitled to compensation for that time. Waiting time at a job site is generally compensable. These categories are easy to miss on a basic timesheet and can create wage liability if not tracked.
Training and Meeting Time
Required training and mandatory meetings are generally compensable work time. The Department of Labor allows them to go unpaid only when all of a strict set of conditions are met, such as attendance being voluntary and outside normal hours. Many businesses track these hours informally or not at all, and if a wage claim is filed, unrecorded training and meeting time becomes a liability the employer cannot rebut.
Correction and Amendment Records
When a timesheet is corrected after submission, the original entry and the correction should both be preserved. A system that simply overwrites the original gives you no audit trail. If an employee later claims their hours were changed without their knowledge, you need to be able to show what the original entry was, who changed it, when, and why.
PTO and Leave Integration
Timesheets that only capture worked hours create a gap when employees take PTO, sick leave, or holidays. The full picture of hours for payroll purposes includes both worked and leave hours. A timesheet system that does not integrate with PTO tracking forces manual reconciliation at every payroll run.
What to Look for in a Timesheet System
Whether you are evaluating your first digital time tracking system or replacing a spreadsheet-based process that has outgrown the business, here is what actually matters.
| Feature | Why it matters |
|---|---|
| GPS verification at clock-in | Eliminates buddy punching and confirms employees are where they should be when they start work |
| Project-level time tracking | Every hour is allocated to a specific project or job code automatically, not filled in after the fact |
| Automatic overtime calculation | Daily and weekly overtime are calculated correctly for your state, not left to manual math |
| Break tracking | Employees clock out for breaks and back in, and the system handles the math and documentation |
| Manager approval workflow | Approval requires a deliberate action after reviewing the entries, not a single click |
| Payroll report export | Timesheet data flows into a payroll report your provider or accountant can use without re-entry |
| Billable hour flagging and invoicing | Billable hours flow from the timesheet to an invoice with minimal manual steps |
| Amendment audit trail | Every change to a submitted timesheet is logged with who made it and when |
| PTO integration | Approved PTO appears on timesheets automatically, so each pay period is complete in one place |
Free Weekly Timesheet Calculator
Use the calculator below to fill in a week of time the way a good timesheet should: clock-in and clock-out times, unpaid break minutes, the project, and whether the time is billable. It totals each day, splits the week into regular and overtime hours, estimates gross pay, and shows billable hours ready for an invoice.
In the example, a field employee at $22 an hour works 48 hours across six days, so 8 of those hours are overtime and gross pay comes to $1,144. Of the 48 hours, 39.5 are billable to client projects. The Saturday shift has no break recorded, but at four hours it stays under the six hour mark the tool uses, so nothing is flagged.
Copy the timesheet to Excel, where hours, overtime, pay, and billable totals stay live formulas, or print it with signature lines for approval.
Weekly Timesheet Calculator
Enter clock-in and clock-out times, unpaid break minutes, the project, and whether the time is billable. The calculator totals each day and the week, splits regular and overtime hours at 40 per week, estimates gross pay, and shows billable hours for invoicing. Overnight shifts are handled automatically. Nothing you enter is saved or sent anywhere.
Employee signature ____________________ Manager approval ____________________ Date __________
How Updoot Handles Timesheets
Updoot's timesheet system is built around the requirements that matter most for small and mid-sized businesses. Employees clock in and out using GPS verification from their phone or a kiosk, so every punch is tied to a location. At clock-in, employees select the project they are working on, which means every hour is automatically allocated to a job without anyone having to fill in a timesheet after the fact.
Overtime is calculated automatically. Breaks are tracked as part of the clock-in flow. Manager approval happens through a workflow that shows the actual entries before confirmation, not a rubber stamp. When it is time to run payroll, Updoot generates a complete payroll report with regular hours, overtime, PTO, and project breakdowns all in one export.
For client billing, billable hours from the timesheet can be pushed to an invoice in two clicks. No manual calculation, no exporting to a spreadsheet, no reconciling between two systems. The data flows directly from the time clock through to the invoice.
PTO requests are built into the same platform, so approved time off appears on timesheets automatically. Every amendment to a timesheet is logged. The full audit trail is always available.
At $5 per user per month, Updoot replaces the spreadsheet, the separate time tracking app, the PTO management tool, and the manual invoicing process with one connected system. For a 10-person team, that is $50 per month to have every timesheet requirement covered from day one.
Sources
Fact Sheet #21: Recordkeeping Requirements under the FLSA (U.S. Department of Labor)
Fact Sheet #22: Hours Worked under the FLSA (U.S. Department of Labor)
Opens in Google Drive. View and download for free.
Related Reading
Excel and Google Sheets Timesheet Template →
Frequently Asked Questions About Timesheets
What is a timesheet?
A timesheet is a record of the hours an employee works during a given period. It captures clock-in and clock-out times, total hours worked, breaks taken, overtime, and in many systems the specific projects or tasks worked on. Timesheets are used for payroll, client billing, labor cost tracking, and legal compliance.
What should a timesheet include?
The employee name, pay period dates, daily clock-in and clock-out times, break times, total regular hours, total overtime hours, project or job codes, and a manager approval signature or digital confirmation. For client billing, it should also split billable and non-billable hours.
Are timesheets legally required?
The Fair Labor Standards Act requires employers to keep accurate records of hours worked for all non-exempt employees, though it does not mandate a specific form. Many states have their own recordkeeping requirements on top of federal law.
What is the difference between a timesheet and a time card?
A time card traditionally refers to a physical card used with a punch clock that records clock-in and clock-out times. A timesheet is a broader record that usually includes project breakdowns, task codes, and manager approvals. In digital systems the two terms are often used interchangeably.
How long should employers keep timesheets?
Under the FLSA, payroll records must be kept for at least three years, and time cards and work schedules for at least two years. Some states require longer, and many businesses keep project time records longer to support client billing.
Are breaks paid on a timesheet?
Under federal rules, short rest breaks of usually 20 minutes or less are counted as paid work time. Meal periods of typically 30 minutes or more generally need not be paid if the employee is completely relieved of duty. State rules may add requirements.
What are the most common timesheet mistakes?
Not capturing break times, failing to track overtime separately, not tying hours to projects, approving timesheets without reviewing them, relying on manual spreadsheets, and having no firm submission deadline before payroll.
Can timesheets be used for client billing?
Yes. Timesheets that capture project-level hours are the foundation of client billing for service businesses. When employees punch into specific projects, those hours can be marked billable and sent to an invoice.