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Most law firms still handle the time and attendance process manually, with timecards or other paper-based methods. A considerable amount of time is spent completing time sheets, approving timecards and inputting hours into the payroll system. Additional time is spent in transferring the time and attendance information from the employee to the supervisor to the payroll department, with frequent phone calls and personal visits often required to pass information from one step in the process to the next. The accuracy of this process is often in doubt, since the enforcement of pay rules depends on the knowledge and diligence of the person entering the information. Often, obtaining information about who approved overtime hours and against which account hours should be billed requires a large amount of searching through timecards and keypunching the information into spreadsheets. In addition, significant amounts of money may be lost in situations where employees overstate the hours that they actually work. HOW TIME AND LABOR MANAGEMENT WORKS Time and labor management software addresses all of these issues by: (1) collecting employees’ hours-worked data, (2) applying a firm’s work rules to those hours, (3) exporting the results to a third-party system, and (4) providing reports for compliance purposes or management decision-making. Automating time and labor management can substantially reduce the source-to-gross portion of the payroll process, which in the typical legal firm can constitute as much as 60 percent of the payroll processing expense. Employees’ time data can be captured through the use of a number of different devices, such as traditional or biometric time clocks, scanners, desktop PCs, Web browsers, interactive voice response, etc. The next step is calculating the gross hours to be paid based on the firm’s overtime, vacation, sick and other pay rules. After that, the information needs to be formatted so that it can be sent to a payroll, billing, enterprise resource planning (ERP) or work force management system. Once collected and calculated, management can also access the information quickly and easily in order to track, for example, labor distribution, overtime, available sick days or vacation accruals. HOW A TIME SYSTEM CAN HELP These methods can substantially reduce the costs involved in the source-to-gross portion of payroll processing by automating many manual processes, such as collecting timecards, keying data into payroll, calculating the pay rules, etc. A time system creates a distributed workflow whereby each worker is responsible for reporting his or her own labor data. Employees save time because they don’t have to hunt for timecards or carry them to their supervisor or a mail drop. The supervisors save time because the time information is organized for them on their computers and they deal only with exceptions rather than examining each and every card. The payroll department typically sees the greatest benefit in reduced inquiries about vacation and sick time and the elimination of manual data input. They also avoid misinterpretation and errors in calculating pay rules, thus ensuring each employee’s time is figured equitably. CONTROLLING OVERTIME EXPENSES In a law firm, the benefits of having more accurate and complete information on hours worked is often more important than the actual dollar savings that can be achieved with time and labor management, because it has a direct impact on profitability. Secretaries, paralegals and other employees are often asked to work overtime. Typically, these overtime hours must be approved by an attorney and charged to a particular case. With a paper-based system, tracking overtime hours can be a nightmare, particularly when other complex pay rules, such as premiums and shift differentials, come into play. The result is that it isn’t possible in many firms to accurately determine who has approved the overtime hours nor to which client they should be charged. The result is that revenues are reduced and expenses are higher than necessary. And in those situtations when hours are correctly charged, it’s usually difficult for management to obtain information on critical factors that affect the profitability of the firm, such as employee attendance and productivity, and the use of overtime by attorney and client. Time and labor management systems solve these problems by entering all time and attendance information into a single database that can easily be queried. A key factor is that managers and supervisors can easily generate their own reports, reducing the burden on the payroll or human resources department. This information can be used to ensure that clients are being properly billed and provide documentation on hours that were actually worked, by which people and on which project. SUBSTANTIAL QUANTIFIABLE SAVINGS The savings from a time and labor management system are significant. In fact, most systems pay for themselves inside of 12 months. For a typical law firm with an annual payroll of $1.6 million, typical overpayments due to human errors can range anywhere from 1 percent to 8 percent of the total payroll. Unreported time can be as much as 6 to 54 minutes per employee per day and it can take as much as 1 to 7 minutes for supervisors to check each timecard. Simply eliminating the time it takes to process timecards by hand will save up to 64 hours per person within the payroll department. The numbers above demonstrate the extremes of each area of savings where even those on the conservative side are impressive. The year-over-year savings can be as much as $435,000 to $3,968,080 on a payroll of this size. SCALABILITY DEPENDS ON ARCHITECTURE A critical factor in selecting such a system is ensuring it will handle the processing loads placed on it by a sizable law firm. At 5 p.m. on Friday, most employees want to enter their time for the day, get a quick response from the system and go home. The traditional two-tier architecture used in client/server systems has difficulties in this scenario because it has to respond to employees entering their information at the same time that it is calculating pay rules for employees that have just completed their entries. These difficulties are increased in cases where users access the server from many different locations and pay rules are complex. As transaction volume and network bandwidth increase, the server increasingly becomes a bottleneck and the two-tier architecture is overwhelmed. Certain applications can meet performance criteria by an optimal mix of client and server functionality. Time and attendance is not one of these applications. Time and attendance solutions are widely distributed, have many concurrent users, generate large transaction volumes and incorporate complex business logic (i.e., pay rules). Therefore, an innovative architecture must be deployed to solve the problems inherent in a two-tier solution. The distributed functional server (DFS) architecture, first deployed in 1997, marked the first time an attendance solution was deployed in a physically scalable three-tier model. Three-tier designs recognize that the client tier is best suited for interfacing with the user (through their PC) and the database server is best used for moving information to and from processing and back to the user. In a variation of the three-tier model, all the complex pay rule calculations are localized in a third component, the DFS. Not only does the DFS add another “player” to the mix, it also does so in a fashion that provides for physical and logical scalability to meet increased computing loads. The implementation method plays an important role in the success of a time and labor management system. The complexity of the type of system required to service a medium or large law firm means that implementation is never simple, but it can be kept manageable with the use of a proactive methodology. The key to this methodology involves the most complicated part of an implementation: coding the firm’s pay rules. Most time and labor management vendors dispatch a person to manage the arduous task of interpreting the proper pay rules and configuring the system to match the needs of the firm. This results in a great deal of time in trial-and-error activities that are time-consuming and often painful for both the customer and the vendor. The new implementation model greatly reduces cycle time and the pain experienced by both parties. The key is that pay rules are carefully communicated in an informational exchange at the beginning of the implementation process. Then, the implementation manager takes this information back to the software vendor’s offices and works with a centralized team to code the rules in a controlled enviroment. This work is done in the early stages of the implementation, so there is plenty of time to test and refine the confirguration. OBTAINING EMPLOYEE BUY-IN Employee acceptance is an important issue that needs to be addressed up front. Employees may resist a system that is designed to accurately measure the time that they actually spend on the job. One way in which many law firms have addressed this issue is to simply allow employees to enter their time in Windows or Web-based forms. These methods for entering time have become popular because they’re easy to deploy and easy for employees to use. In addition, an executive sponsor with a solid commitment to the program helps to secure employee buy-in. All in all, time and labor management systems improve the speed and accuracy of employee time collection while helping management gain more control over labor costs and human resources expenses. The net result is higher profitability and a stronger bottom line for mid- to large-sized law firms. � Mobile TimeBilling 2.0 from Wireless Verticals Inc. ( www.WirelessVerticals.com) runs on both Palm and Research In Motion operating systems. It includes atutomatic download of client and project/matter data to the handheld; Timeslip confirmation; shortcut keys for quick description entry; and more. It integrates with Advanced Productivity Software’s DTE, Elite Information Systems’ Professional Billing System and Sage’s Carpe Diem. Wirelss Verticals also announced that it has formed an alliance with Computer Law Systems Inc. to allow attorneys to make entries in their Palm or BlackBerry handheld device. � Timeslips 10.5 from Sage U.S. Holdings Inc. ( www.timeslips.com) adds new features, including split billing; tutorial navigator, database creation wizard; firm/data entry assistant; and user-defined report wizard. According to Sage, the upgrade is designed to integrate with Timeslips’ upcoming “Front Office” and “Back Office” programs. � Tactical Service from LexTech Inc. ( www.LexTechInc.com) takes paper or electronic legal bills in any format, computer analyzes and automatically UTBMS codes each item and reviews it against a client’s billing guidelines. It also allows clients to change guideline results via the Internet and export approved bills. � Software Technology Inc. has released TABS III 10, the latest version of its time-and-billing program. It features bi-directional integration with the company’s Case Master case management software. � DataCert ( www.datacert.com) and Elite Information System Inc. have announced a partnership to use ShareDoc/LEGAL and Elite’s time-and-billing application to translate invoice formats into any common format used in a legal department. The invoices can then be delivered into Elite’s Law Manager case management system. The cooperative effort enables full tracking and reporting capabilities and allows corporations and their law firms to agree on business rules and validation to be applied to the invoice data as it moves. � Advanced Productivity Software Inc. ( www.aps-soft.com) has debuted DTE for Microsoft Outlook. It offers a time entry screen with all DTE functionality. Entries appear on the timekeeper’s calendar on the date the entry was created, and can be edited, deleted, released and unreleased. � Source Time & Attendance from Ceridian Time and Attendance ( www.ceridian-time.com) is a time engine designed for use by all types of employees including hourly and salaried, exempt, part- and flex-time, contract or temporary, tracking time worked and non-worked time using electronic time cards viewed on personal or networked computers. Mary Kay Flege is product manager with Ceridian Time and Attendance based in New Albany, Ind. Her e-mail address is [email protected].

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