When Timekeeping Software Undermines Compliance

Electronic timekeeping is a ubiquitous feature of the modern workplace. Time and attendance software enables employers to record employees' hours worked, breaks taken, and related data to determine compensation. Sometimes this software also undermines wage and hour law, allowing bad actor employers more readily to manipulate employee time cards, set up automatic default rules that shave hours from employees' paychecks, and disguise edits to records of wages and hours. Software could enable transparency, but when it serves to obfuscate instead, it misses an opportunity to reduce costly legal risk for employers and protect employee rights. This article examines thirteen commonly used timekeeping programs to expose the ways in which software innovation can erode compliance. Drawing on insights from the field of behavioral compliance, we explain how the software presents subtle situational cues that can encourage and legitimize wage theft. We also examine gaps in the Fair Labor Standards Act's recordkeeping rules – unchanged since the 1980s – that have created a regulatory vacuum in which timekeeping software has developed. Finally, we propose a series of reforms to those recordkeeping requirements that would better regulate timekeeping data and software systems and encourage wage and hour law compliance across workplaces