A director at a company I worked for mandated that all time-sheets be accurate to within 5 minutes for each task, so that future projects can be estimated accurately in terms of time and cost. There was an implied penalty if this was not followed. All 37.5 hours per week must be accounted for but nobodies time may exceed the allotted 37.5 hours.

My argument to him would be that timesheets, which do not factor in unpaid overtime (which a lot of us do), cannot be used to accurately gauge project cost and project time in the future, as overtime is not recorded on the timesheets.

Would I be correct in telling the company that their mandate is flawed as this leaves overtime unaccounted for? How can I professionally and politely bring this potential flaw to managements notice?

EDIT: Because there is some discussion over whether this question belongs here (not sure where else it could go on SE), perhaps that it leads to a bigger question not of "are timesheets accurate without unpaid overtime" but rather "why don't we record unpaid overtime" (which isn't a "navigating the workplace" question), I'll accept Philipp's answer as he makes some excellent points (especially about the pixies).

Thanks everyone.

EXAMPLE: To keep the maths simple, let's say your team builds a website for a client.

  • 3 people, one week.
  • Each member puts 37.5 hours (standard working week) into the timesheet.
  • You bill the client for 112.5 hours (at whatever rate you charge).
  • Your cost is 112.5 hours (at whatever you pay your staff)

A second job comes in - an identical website. You quote for 112.5 hours at the same rate and promise it will be done in 1 week. However, you then find out that those 3 people worked 45 hours that previous week (7.5 hours was unpaid overtime), not 37.5, and this week they all finish work each day on time.

  • 3 people, one week + 1 day (to make 45 hours each)
  • You've quoted for 112.5 hours but...
  • Your cost is 135 hours.

Same project, different costs.

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    Possibly. Is there a better place for me to ask this question? – VictorySaber Feb 12 '14 at 9:48
  • I'm not sure there is an SE about this yet. You might be lucky finding one in Area 51 – CMW Feb 12 '14 at 9:51
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    @VictorySaber i did a rather large edit to this question to bring it up to standards, is this essentially the question you would like to ask? – Rhys Feb 12 '14 at 11:33
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    @VictorySaber 'Am i right' is not an acceptable question on this site i am afraid, all it does is lead to discussions and everyone throwing their opinions about what is 'right' around. We prefer structured questions that lead to factual or evidence supported answers. Hope you understand! :) – Rhys Feb 12 '14 at 11:45
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    @VictorySaber that questions isnt really about navigating the workplace, questions here are mostly about the interactions between people, not a specific task at work. So on topic questions are things like communicating with managers, colleagues to resolve problems ect. – Rhys Feb 12 '14 at 11:48

The problem with any kind of mangerial accounting is that you only get what you measure.

When it comes to billing clients, it might be necessary to report numbers which aren't really the truth. The management might promise the client to complete their project in 112.5 hours or 3 weeks. They manage to pull it off in 3 weeks, but they required more than the 112.5 hours by letting people work overtime. They could now try to bill the overtime hours on the client, but they might decide not to because telling the customer "You have to pay extra because we were too incompetent" is not the best way to ensure further business.

But when you want to measure worked hours for your internal project planning, it is usually much smarter to let people report the hours which were actually worked, regardless of what you can actually bill. When a company assumes that every employee works 10% unpaid overtime they could factor this in by adding 10% to all reported project times. But that doesn't account for the fact that employees might spend overtime mostly working on time-critical projects. That means the effort on non-critical projects might be overestimated and that on critical projects underestimated.

The difference between billable hours and non-billable hours is an important performance figure every company should be aware of. That means it is usually a good idea to report overtime hours as a separate figure in the timesheets.

But also keep in mind that unpaid overtime is a figure some companies don't want to be aware of. There might be regulations in place which actually forbid unpaid overtime, but the business culture is creating so much pressure on individual employees that it still happens. So the overtime hours are kind of a big open secret everybody is aware of but nobody is allowed to admit. So the timesheets claim that everyone goes home on time and they pretend that all the work not represented in them is done overnight by magic overtime pixies.

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    I cannot yet upvote, but this line "That means it is usually a good idea to report overtime hours as a separate figure in the timesheets." I definitely agree with. I think it should be reported, and am amazed places do not. I suppose employees might get annoyed when they see how much free time they are giving over the course of a year. – VictorySaber Feb 12 '14 at 11:45
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    And if you have government contracts to not report unpaid overtime is timesheet fraud and you can get into alot of legal trouble. – HLGEM Feb 12 '14 at 21:10

Phillipp has hit the important points about timesheets, so think of this as a supplemental answer.

I've filled in timesheets for thirty years in five or six separate organizations, though never one in which time was actually billed to a client. In not one of those did they provide a useful measure of the amount of work actually done. Not only is it absolutely normal to have to record exactly the official number of hours in a week, regardless of what was actually work, but timesheets policies almost never allow you to record extra stuff you have to do, like cleaning up your hard drive, installing new software, or helping the guy in the next desk with the project you are not supposed to be working on. By the way, one of my timesheets needed to be filled in hours to two decimal places - in other words, to an accuracy of six seconds!

To answer your actual question, your company almost certainly knows that the process is flawed. They probably want the figures for something other than actual planning, even if they say that's what its for. Mention it to your immediate boss, and then forget about it. By the way. there is nothing to stop you and your team from keeping accurate records of how long you spend on stuff, so that you can estimate your own work more accurately.

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  • I like the idea about us guys doing the work keeping more accurate records. One common complaint I've seen if where we say "one week" we mean "[because we are workaholics and a week to us is almost 50 hours it will take] one week". Then they give it to somebody else who does 9-5 hours and it takes a week and a half. – VictorySaber Feb 12 '14 at 15:15

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