Recording employee hours accurately is critical, yet often challenging, for most businesses.
Luckily, Xero provides flexible time tracking features to simplify hourly reporting.
In this post, you'll discover step-by-step instructions for setting up timesheets in Xero, tracking hours across projects, integrating with payroll systems, and optimizing time data for organizational success.
Introduction to Recording Time Sheets in Xero
Tracking employee hours is crucial for effective payroll management and oversight of projects. Xero's time tracking features provide a streamlined way to record this data.
This section outlines the basics of using Xero to track time sheets. Key highlights include:
- The importance of accurate time sheets for payroll and monitoring project budgets
- How to set up time tracking in Xero to match your teams and projects
- Recording time entries via manual entry or integration with time tracking apps
- Generating Timesheet and Project Detailed Time reports to analyze where time is being spent
- Leveraging the data to optimize budgets, invoices, and payroll
Accurately tracking time ensures employees are paid correctly and allows better oversight of where time and money is being concentrated on projects. Xero provides the tools to seamlessly record this data.
How do I track employee hours in Xero?
Tracking employee hours is crucial for monitoring productivity and ensuring accurate payroll. Xero provides a simple way to track timesheets directly within the software.
Here are the key steps:
View the Timesheet Summary Report
- In the Accounting menu, select Reports.
- Under Payroll, click Timesheet Summary. This will show total hours logged for each employee over a specified period.
Configure Report Filters
You can filter the Timesheet Summary to show exactly what you need:
- Employees: Select all or specific employees/groups to include.
- Date Range: Choose the pay period or custom dates.
- Earnings Rate: Filter by hourly wage or salary rules.
- Timesheet Category: View by categories like billable client work, administrative tasks, etc.
Enter Employee Timesheets
Employees can log hours directly in Xero against specific projects and clients. As their timesheets are completed, the hours automatically aggregate in payroll and invoices.
Export and Use Data
Once the report filters are set, click Update to run it. Export the data or use it to reconcile hours for payroll. Monitoring timesheets this way ensures accurate tracking employee hours for billing and payments.
Integrating Xero with payroll providers like Gusto further simplifies managing staff hours across both platforms. Their direct connection enables seamless data syncing.
With some strategic planning and consistent oversight, the Xero Timesheet Summary provides the visibility needed to closely track employee hours and keep payroll running smoothly.
How do I add a timesheet to an employee in Xero?
To add a timesheet for an employee in Xero, follow these simple steps:
- In the Payroll menu, select Timesheets.
- Click Add Timesheet.
- Select the Employee from the drop-down menu.
- Select the pay Period that the timesheet applies to.
- Click Save to add the timesheet.
The timesheet will now be available for the selected employee and pay period. You can enter hours worked on different projects or tasks.
Xero makes time tracking simple by connecting timesheets directly to payroll. As employees add hours worked to timesheets, Xero automatically calculates pay including overtime, based on pay rates set up in payroll. This saves time on manual calculations.
Accurate timesheets feed into powerful reports in Xero like Project Detailed Time report. This tracks staff project time across the business for better cost control and insight. With seamless Gusto integration, Xero handles everything from time tracking to payments, with automated payroll powered by accurate employee timesheets.
How do I record time in Xero?
To record time in Xero, follow these simple steps:
- Click the clock icon, then click the add icon to start a new timer.
- Click "Start" to begin tracking time for your task or project.
- When you've finished working, click the clock icon again and then click the running time count to stop the timer.
- (Optional) Add a note or description to provide more details about what you were working on. This can help when reviewing time logs later.
- Finally, click "Save as Draft" to save the time entry.
This allows you to easily track time directly within Xero without needing to use another app or spreadsheet. The time logs can then be used for client billing, analyzing project costs, and payroll purposes.
Some tips when recording time sheets in Xero:
- Assign time entries to specific projects and tasks to better understand where effort is being spent. This utilizes Xero's project tracking features.
- Enter brief but descriptive notes on each time entry. For example, "Researching content ideas for next month's newsletter".
- Record time as you work to avoid forgetting tasks. Set reminders if needed.
- Review and approve time sheets weekly. This keeps them accurate for payroll and ensures no time is missed.
Using Xero's built-in time tracking helps businesses better understand where employee time is spent. It's an easy way to capture billable hours and is essential for monitoring the profitability of projects and clients.
Does Xero have a timesheet function?
With Xero Payroll, employees can easily track their time and have it automatically fed into payroll. Here are some key ways Xero enables time tracking:
- Xero Me - Employees can access personalised timesheets through Xero Me to track hours worked on various projects or tasks. This timesheet data flows directly into payroll.
- Auto Time Tracking - If the business uses projects in Xero, billable employee time can be automatically tracked against specific projects without manual timesheet entry. This streamlines time tracking.
- Project Detailed Time Report - Managers can generate reports to view total hours worked by staff on various projects. This enables oversight of time spent per project or client.
- Integration with Gusto - For US customers, Xero seamlessly integrates with Gusto payroll. Employees' timesheets and hours in Xero automatically sync to Gusto for simplified payroll.
In summary, Xero provides easy-to-use digital timesheets, automated time tracking tools, and integrations to feed hours directly into payroll. This saves administrative hassle so you can focus on your business.
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Setting Up Time Tracking in Xero
Time tracking is an essential feature in Xero that allows businesses to record employee hours worked on specific projects. This provides greater visibility into where time is being spent, ensures accurate client billing, and streamlines payroll.
Accessing Time Tracking Preferences in Xero
To enable time tracking in Xero:
- Navigate to the Settings menu
- Select General Settings
- Click on Payroll Settings
- Under Time Tracking, toggle the button to On
- Check the box to Allow employees to record time
- Click Save
This will activate time tracking across Xero and allow employees to submit timesheets.
Activating Time Tracking for Xero Projects
To track time for specific projects:
- Navigate to any Project
- Click Project Settings
- Under Time Tracking, toggle to On
- Check Allow employees to record time
- Click Save
Now when employees record time, they can allocate hours to this project.
Configuring Employee Permissions for Timesheet Entry
To allow employees to submit timesheets:
- Go to Settings > Users
- Click on any employee
- Under Access, check Can Register Time
- Click Save User
This permission enables employees to log hours worked. They can fill out timesheets via web, mobile, or integrations like TSheets.
With time tracking set up, businesses can gain insights into how work effort aligns with budgets. This allows for accurate client billing and efficient payroll processing powered by Xero's seamless integration with Gusto.
How to Record Time Sheets in Xero
Recording time sheets accurately in Xero can streamline payroll and ensure employees are paid correctly for hours worked. Xero offers both manual time sheet entry as well as auto time tracking to fit different business needs.
Manual vs. Auto Time Tracking in Xero
Manual Time Entry
Manually entering time sheets allows employees to track time against specific projects and tasks. This works well for businesses that need to allocate hours across multiple jobs.
To enter time manually in Xero:
- Navigate to the Timesheets section
- Select "Enter Timesheet"
- Choose the applicable pay period
- Enter hours worked each day, allocating to specific projects
Auto Time Tracking
Xero offers time tracking automation through integrations with apps like TSheets. TSheets automatically records time based on activity across devices. This saves employees time from manual entry.
Auto tracking works for businesses focused on tracking employee productivity rather than allocating hours across specific projects.
Finalizing and Submitting Time Sheets in Xero
Once time sheets are entered manually or tracked automatically, employees should:
- Review time sheets for accuracy
- Edit as needed to fix any errors
- Submit the time sheet for approval by specified deadline
Submitted time sheets route to managers for approvals. Employees can also add notes or comments for clarification if needed.
Approvals and Payroll Integration with Gusto
After employees submit time sheets in Xero, managers can review and approve them based on policy.
Once approved, time data flows automatically into integrated payroll software like Gusto. This eliminates manual re-entry and ensures employees are paid properly each pay period.
Time tracking in Xero combined with integrated payroll makes the process seamless for staff and managers alike. Accurate time sheets lead to accurate payroll with minimal administrative effort.
Utilizing Xero for Tracking Employee Hours on Projects
This section will focus on the specifics of using Xero to track staff project time, ensuring accurate billing and project management.
Setting Up Xero Projects for Time Tracking
To start tracking time in Xero, you first need to set up projects. Here are the steps:
- Go to the Projects section in Xero and click "Add Project"
- Give the project a name and description
- Select the customer the project is for
- Choose start and end dates, project status, and billing type
- Click "Save"
Once a project is created, you can assign staff members to track their time. This allows for accurate billing based on time spent.
Linking Time Sheets to Specific Xero Projects
There are two ways staff can link their logged hours to Xero projects:
- Manual entry: When filling out weekly timesheets, staff can select the appropriate project from a dropdown menu for each time entry. This connects the hours directly to that project.
- Auto tracking: If the Xero Timesheets app is used to track hours, projects can be selected within the app. All time entries will then automatically sync with the respective projects in Xero.
Both methods make it easy to connect staff time to client projects for precise billing.
Analyzing Project Detailed Time Reports in Xero
Xero offers detailed time reports to analyze project costs and productivity:
- The "Project Time Tracking" report shows total hours logged per project. This aids in reconciling billable time.
- The "Detailed Project Time Report" breaks down hours per staff member. This helps evaluate individual productivity on client work.
- Comparing project time vs. estimates highlights scope creep. Adjustments can then optimize future resource allocation.
These insights help assess profitability and inform strategic decisions per project. Enabling time tracking is key to unlocking these critical analytics.
Integrating Advanced Time Tracking Tools with Xero
As businesses grow and take on more complex operations, basic time tracking functionality in accounting software like Xero may no longer be sufficient. Integrating third-party time tracking applications can provide enhanced features to meet evolving needs. Two popular options worth considering are TSheets and Harvest.
Automating Time Capture with TSheets and Xero
TSheets offers robust time tracking tailored for mobile and distributed workforces. Key benefits of integrating TSheets with Xero include:
- Auto Time Tracking: TSheets can automatically track time in real-time based on employee location or device usage without manual input. This saves significant administrative effort.
- Simplified Timesheets: TSheets timesheets auto-populate with the tracked hours, streamlining the approval process. Employees can also add manual time entries for flexibility.
- Real-time Sync: Time entries flow directly between TSheets and Xero in real-time for up-to-date financial reporting.
- Enhanced Analytics: TSheets provides insightful reports and dashboards to analyze employee utilization across projects, tasks, and locations.
- Flexible Rates: TSheets supports pay rates, overtime calculations, and shift differentials for more advanced payroll needs.
For teams that spend significant time away from desks or have complex pay rules, TSheets is an invaluable addition to Xero.
Leveraging Harvest for Project Management and Timesheets in Xero
Harvest offers robust project management tools that can meet the needs of agencies and professional services firms. Benefits of integrating Harvest with Xero include:
- Project Planning: Harvest provides project budgeting, task management, and resource allocation across teams. This enhances project visibility.
- Powerful Time Tracking: Harvest enables timers for manual time entry as well as tools like web activity tracking. Project time can be accurately tracked.
- Team Collaboration: Teams can collaborate across projects and timesheets, with managers able to review and approve all in one system.
- Billing Management: Harvest integrates timesheets and expenses into polished invoices, simplifying accounts receivable.
For project-centric teams, Harvest removes friction from tracking billable hours and expenses while keeping Xero as the source of truth for finances.
Evaluating tools like TSheets and Harvest can help grow businesses identify the right time tracking capabilities to integrate with Xero to match their unique needs and streamline operations. The robust feature set around automated data flows, advanced analytics, and flexible controls provides enhanced support for mobile workforces and complex projects.
Best Practices for Effective Time Tracking in Xero
Establishing Clear Time Tracking Policies
It is important for businesses using Xero to have clear and well-communicated time tracking policies. This ensures all employees understand what is expected of them for accurately logging their time in the system. Some best practices include:
- Create a formal policy document that outlines time tracking procedures and guidelines. Specify what activities should be tracked, rounding rules, approvals process, etc.
- Train all staff on time tracking policies during onboarding. Have them acknowledge receipt and understanding of procedures.
- Set expectations for timely time sheet submissions. Communicate due dates and reiterate importance of accuracy.
- Explain how time tracking data will be used for payroll, billing, project analysis, etc. Stress the impact accurate time keeping has on operations.
- Consider tying time tracking compliance to performance evaluations to motivate adherence.
Training Employees on Xero Time Tracking Procedures
Employees should receive hands-on training for entering and submitting Xero timesheets to ensure proper usage of the software system. Effective training topics include:
- Demo logging time against various projects, tasks, clients, etc. Provide examples for real-world scenarios.
- Review location of time tracking features in Xero interface. Ensure accessibility on mobile devices if applicable.
- Explain process for submitting timesheets for manager review and approval prior to payroll.
- Share best practices such as daily time tracking to prevent missed hours, categorizing activities, entering descriptions, etc.
- Overview reporting features to demonstrate insights gained from time data.
Follow-up with users to address questions and issues. Send reminders of best practices and policies.
Regularly Reviewing Time Sheet Data for Optimization
Managers should consistently review submitted Xero timesheets with a few goals in mind:
- Verify accuracy - Are hours logged against the appropriate projects? Do descriptions match work performed? Does time data align to expectations?
- Identify issues - Are certain tasks taking longer than anticipated? Are there productivity gaps to address?
- Streamline processes- Can workflows be optimized based on findings? Should policies be updated?
- Enhance reporting - What additional data filters or visualizations are needed for insights?
Designating time for ongoing timesheet analysis fosters data integrity and opportunities for operational improvement. Be transparent with staff on how reviews connect to larger business objectives around efficiency and cost management.
Conclusion: Maximizing the Benefits of Xero Time Tracking
Xero's time tracking features provide a streamlined way for businesses to record employee hours worked on client projects. By leveraging Xero's integration with Gusto payroll, companies can simplify payroll preparation while maintaining detailed visibility into how staff time is being allocated.
Here are some key benefits to using Xero for time tracking:
- Auto-population of timesheets based on task duration in Xero Projects saves employees time while ensuring accuracy. This eliminates manual data entry and reduces human error.
- Real-time updates on billable project hours supports more agile resource planning. Managers can track capacity vs utilization to right-size teams over time.
- Project cost tracking down to the hour provides transparency into profitability. This allows for better decision making on pricing and resourcing.
- Seamless Gusto integration enables automated hourly wage calculations during payroll runs. This saves significant administrative effort while minimizing compliance risk.
To maximize the advantages of Xero's time tracking capabilities, businesses should:
- Standardize processes company-wide for recording and approving timesheets in Xero. This ensures consistency across departments.
- Train employees on utilizing Xero Projects for time entry against client work. This drives faster user adoption.
- Review Project Detailed Time reports frequently to optimize resource allocation decisions and project pricing.
- Set up Gusto integration for streamlined payroll preparation using hours tracked in Xero. This saves time and money.
Taking these steps will help companies realize the full benefits of Xero as a robust timekeeping and payroll management platform. Tight integration between Xero Projects and Gusto Payroll provides the visibility and controls needed to make strategic resourcing decisions while keeping overhead costs in check.
