Definition: A clock card, also called a time card, is a source document that records the number of hours each employee works during a pay period. This not only creates a document that the payroll clerk can use for preparing payroll, it also creates an internal control. Employees are not in charge of keeping track of their own working hours. The clock card does it for them. This system helps decrease fraud and payroll scams.
What Does Clock Card Mean?
There are many different kinds of clock cards that record time in many different ways.
Traditional time cards are physical pieces of paper that are stamped with a date and time when run through a time machine. These are the cards we are all familiar with because every hourly worker used them—even Fred Flintstone. 🙂 Employees would run the cards through the time machine at the beginning of the workday and the end of the workday. This would record their working hours, so the bookkeeper could prepare their paychecks.
Modern companies rarely have physical clock cards anymore. It’s more often that employees swipe a card or login to a system to keep track of their hours worked instead of the old physical card system.
A modern system like this has several advantages over a traditional one. Payroll, for example, is much easier to calculate and prepare on a computerized system because no additional information must be input. Everything is already in the system. A physical card system requires the payroll clerk to input every employee’s time manually for each payroll. This can lead to mistakes and input errors.
Clock cards are also used by manufacturers to track the labor costs of each production process. Production managers can use cards, also called time tickets, to record the amount of labor hours used in each step of production. This system will lead to much more accurate labor costs and cost of goods sold.