Digital time tracking: Mastering the obligation to record working hours
For many companies, the ruling by the Federal Labor Court was one thing above all else: a tiresome obligation. But systematic time tracking is now unavoidable. This article explains how this requirement can not only be met, but also used as an opportunity for greater efficiency and transparency. With modern, low-code time tracking software, processes can be efficiently optimized – making traditional timesheets a thing of the past.
Why is the obligation to record working hours so important now?
The obligation to record working hours became binding for all companies in Germany following a ruling by the Federal Labor Court (BAG) in September 2022. This implemented an earlier decision by the European Court of Justice (ECJ) into national law. The BAG ruling clarifies that employers must introduce a system for systematically recording all of their employees' working hours. Manual and unreliable paper-based systems no longer meet these requirements, which is why digital solutions are coming into focus.
The documentation of working hours is therefore no longer a voluntary measure, but a legal requirement. The aim is to ensure compliance with legal requirements such as break times and rest periods and to protect the rights of employees. Employers must ensure that their employees' working hours are recorded, but they can delegate the task of time recording to the employees themselves.
What does the ECJ ruling on working hours say?
The fundamental ruling of the ECJ already established in 2019 that EU member states must require companies to introduce an objective, reliable, and accessible system for recording working hours. This system must record the duration of each employee's daily working hours. The European Court of Justice ruling aimed to strengthen the rights of employees and ensure compliance with the provisions of the Working Hours Act (ArbZG).
The BAG decision has specified this ECJ ruling for Germany. It is no longer a question of whether working time must be recorded, but how. The focus is on documenting working hours in order to provide complete proof of hours worked and any overtime. This creates legal certainty for both sides and forms the basis for correct payroll accounting.
What does the obligation to record working hours mean for trust-based working time?
Does the obligation to record working hours electronically spell the end of trust-based working hours? The answer is no, but the model needs to be adapted. Trust-based working hours mean that the employer waives the right to monitor the contractually agreed working hours, but not that working hours do not have to be recorded. Documenting working hours does not conflict with such an agreement.
Even with a trust-based working time model, the start and end of daily working hours and breaks must be recorded. The obligation to record working hours digitally does not change the trust, only the need for documentation. The employer can delegate the recording to the employees, who then record their working hours in the system on their own responsibility.
What does the draft bill to amend the Working Hours Act say?
The Federal Ministry of Labor and Social Affairs has presented a draft bill to amend the Working Hours Act in order to enshrine the requirements of the ECJ and the BAG in law. The draft stipulates that working hours must be recorded electronically on the day they are worked. It confirms the obligation to record the start, end, and duration of daily working hours.
The draft also contains possible exceptions for certain groups of employees and provides for flexibility in collective agreements. Nevertheless, the basic principle remains: employers must ensure that their employees' working hours are recorded. The exact form of electronic time recording is not rigidly specified, which gives companies flexibility in choosing their time recording system.
How does digital time recording via app or terminal work?
Modern time recording is simple and flexible. Employees record their working hours either at a stationary terminal in the company, on a PC, or—increasingly popular—on the go via smartphone. Time recording via app offers maximum flexibility for mobile working, field service, or working from home. Employees can record their working hours directly via the app, which greatly simplifies the process.
Whether via app or terminal, the data is immediately transmitted to the central time recording system. There, the start, end, and duration of the daily working hours are stored. Time recording via digital tools is not only more efficient than the classic timesheet, but also significantly less prone to errors. Modern systems also often enable integrated project time recording, where working hours can be directly assigned to specific projects.
What are the advantages of electronic time recording for companies?
Electronic time tracking for companies offers much more than just compliance with legal requirements. Automation eliminates the manual effort of data entry and checking, which greatly reduces the administrative burden. Electronic time tracking provides an accurate and reliable data basis that is essential for payroll accounting and operational planning. This creates a high level of transparency regarding the hours worked.
In addition, good time tracking software enables detailed evaluations. Companies can use the evaluation to analyze productivity and optimize personnel planning. The precise recording of working hours, breaks, and absences leads to fair billing for every hour of overtime. This makes time recording a strategic tool for efficient business management.
How can working hours be easily recorded and evaluated?
Modern time recording systems are designed to make it as easy as possible to record working hours. Employees simply need to log the start and end of their work, and the software does the rest. Your employees' working hours are automatically recorded and stored. The recorded data can then be used for various purposes. A key function is the automatic creation of timesheets for personnel files.
The data is usually evaluated via a dashboard that displays all relevant key figures at a glance. This ranges from total working hours and overtime balances to compliance with statutory break times. Good software ensures that employees are provided with a copy of the record, which further increases transparency.
How does low-code help with operational implementation?
Introducing suitable time tracking software can be a challenge. This is where low-code platforms such as Microsoft Power Apps offer an ideal solution. They enable you to create customized digital time tracking that is perfectly tailored to your specific operational processes. This allows the design of the time tracking system to be flexible and quick.
With low-code, time tracking can be seamlessly integrated into existing systems such as project time tracking or payroll accounting. Instead of purchasing rigid, stationary software, companies develop their own flexible solution. This allows time tracking to be introduced that adapts to the company's working time model and not the other way around.
Our solution: Digital time tracking with the Microsoft Power Platform
At metanoy, we rely on the Microsoft Power Platform for fast and flexible process automation – our solution for digital time tracking is called metaTRACK. We can customize it to your requirements and implement it for your company.
Microsoft Power Apps at the heart: With Power Apps, we design intuitive and user-friendly interfaces that integrate seamlessly into existing Microsoft 365 and SharePoint environments.
Dataverse for secure data management: All recorded time data is stored centrally and securely in Dataverse, Microsoft's intelligent database.
Power Automate as an automation booster: Power Automate connects everything and controls the logic in the background. From automatic notifications for requests to the creation of weekly reports – the possibilities for increasing efficiency are enormous.
A building block for your digital transformation
The introduction of digital time tracking is more than just the optimization of a single process. It is an important step that contributes to the digital transformation of the entire company. Automated, efficient, and flexible processes not only increase productivity but also free up resources that can be used for innovation and strategic growth. This ensures long-term competitiveness—and we at metanoy are the experts who can help you take this crucial step. With customized low-code solutions, we turn a legal obligation into a real competitive advantage.
The most important facts at a glance
- Legal obligation: Since the BAG ruling, systematic time recording has been mandatory for all companies in Germany
- Electronic form: The legislator requires electronic and tamper-proof recording of working hours.
- Flexibility: Modern systems enable mobile time recording via app, PC, or terminal.
- Advantages: Digital time recording increases efficiency, creates transparency, simplifies payroll accounting, and ensures legal certainty.
- Trust-based working hours: Still possible, but also requires complete documentation of working hours by the employees themselves.
- Customized solution: Low-code allows you to develop tailor-made time tracking software that fits your processes perfectly.
Get in contact with us:
Book an appointment with our Managing Partner and Co-Founder Dr. Marek Stess or send us an email with your questions.