Worldwide Time Tracking Laws to Follow for a Global Team

If you own a US-based company but also manage a remote team of employees, you need to be aware of time tracking regulations worldwide. 

Depending on the country in which your employees reside, you should get familiar with the time tracking laws as soon as you hire them.

But don’t worry — it’s natural not to feel overly joyous when you must comply with so many regulations for your workforce.

We’re here to guide you through time tracking regulations around the globe. 

Let’s get started.

US time tracking laws — From FSLA to state-based laws

When it comes to time tracking regulations in the United States, you must comply with the Fair Labor Standards Act (FLSA). There’s also the matter of state-based laws — some US states have them — and you should also consider the Defense Contract Audit Agency (DCAA), the 7-minute rule, and whether you should also track time for exempt employees.

Let’s explain each in more detail.

Fair Labor Standards Act (FLSA) does not define the maximum number of hours per week

The FLSA (1938) is a federal law that regulates employees’ rights, minimum wage, overtime, and unfair practices. It also covers the time tracking and working time provisions in the US. 

For illustration, time tracking records must include: 

• Hours worked per day,
• Beginning and end of the working day,
• Breaks,
• Overtime, and
• Wage paid.

Employees should store these records for 3 years.

Interestingly, the law doesn’t address the maximum number of hours worked in a week. But after 40 hours, each subsequent hour will be considered overtime.

Apart from that, the law doesn’t state the preferred method for time tracking — so, feel free to choose either manual or digital time tracking. However, we suggest you turn to digital methods, as they greatly reduce the chances of making mistakes.

Besides the FLSA, each state can have its own regulations concerning time tracking. 

However, you need to consult with the specific state labor laws to be completely compliant with time tracking regulations. 

We’ll now present you with some of those. 

Some state-based laws around the US require up to 6 years of record-keeping 

Here are some of the more striking specific laws regarding time tracking regulations: 

• New York Labor Law — You must keep time tracking records for at least 6 years. The records must be written in English and in the primary language of the employee. The employee must sign the records for them to be valid.
• California Labor Law — California’s law states that paper time tracking records are valid, as long as they’re in English and ink. The law also states that the employer won’t prohibit the employee from keeping their personal record of working hours.
• Rhode Island Monitoring Law — Tracking devices such as GPS can be used only if all parties agree to it in writing. Additionally, as an employer, you must keep time tracking records of all employees, even if they’re salaried employees. 

Do you have government contracts? You need to comply with the Defense Contract Audit Agency (DCAA) 

The DCAA is an audit agency that provides financial advisory services to the Department of Defense and other federal entities responsible for acquisition and contract administration. 

Acquisition means purchasing new supplies and services, and contract administration involves activities that aim to ensure that the government and the contractors meet the contract’s requirements. 

So, the DCAA has only one goal: to ensure that government money is well spent. 

If your business has government contracts, you must also follow the DCAA’s guidelines for time tracking. 

To appease the DCAA, your time tracking records must include:

• Vacation days,
• Sick days,
• Other types of leave.

Apart from that, you should state the number of hours worked each day and mention the project the employee worked on.

Does the 7-minute rule mean you’ll pay your employees more? 

The FLSA law allows rounding the time when the employee clocks in and out. Time rounding makes defining paychecks more convenient. 

According to this Fair Labor rule, the hours of clocking in and out will be rounded to the nearest quarter. 

So, when the employee starts working at 7:05, the starting hour will be rounded down to 7 o’clock. If the employee starts working at 7:08, the starting point will be rounded to 7:15. 

The rule is cleverly designed not to affect paychecks but to reflect the reality of working hours.

The 7-minute rule is a novel term, and as an integral part of the centuries-long time tracking evolution, it’s here to stay. 

Exempt employees — To track or not to track time? 

The 2 types of employees, exempt and non-exempt, have different time tracking requirements. 

You aren’t obligated to keep records of your exempt employees’ time. These employees usually receive a fixed salary, no matter the hours worked. 

Non-exempt employees typically work by the hour. And it’s their time that you need to closely track to ensure all hours are paid properly. 

However, while this is generally the rule, you need to consult with the specific state law to determine whether exempt employees’ time should be tracked.

Time tracking regulations in Australia, a country with hefty fines for non-compliance

Full-time employees in Australia enjoy one of the shortest work weeks in the world, with 38 hours allowed over 7 days. 

On a similar note, the Australian Fair Work Act mandates that time tracking records be kept for 7 years. In fact, these records need to be in English, legible, and accessible to Fair Work Inspectors.

Similarly, the records should include: 

• The number of overtime hours, and 
• The start and finish times of overtime hours.

Overtime work compensation can differ depending on the specific Modern Award agreement — a document that outlines the minimum terms and conditions of employment. It includes information such as: 

• Pay,
• Working hours,
• Overtime,
• Breaks,
• Allowances, and
• Penalty rates.

Usually, employees are paid 1.5 times higher for the first 2 hours of overtime and 3 times higher for every hour after that. This is why it’s vital to have correct records of employees’ working hours.

According to the Fair Work Act, the fines for wrongful time tracking are rather hefty. For businesses, the fines can reach a staggering $93,900 — or even more for serious violations.

Serious violations mean the business was reckless about whether the violation would occur or that the business knew it was violating an obligation of workplace law. 

In that case, if you have a business with more than 15 employees, you can face a fine of up to $939,000.

Free time or overtime pay? Time tracking regulations in Canada let you choose

Canada follows the Labour Code when it comes to defining:

• Working hours,
• Vacations,
• Breaks,
• Overtime,
• Leave, and
• Time tracking.

In Canada, overtime is paid 1.5 times higher than the employee’s agreed hourly wage. 

Nevertheless, for every overtime hour, employees can get 1.5 hours of free time instead of money if they wish. 

For this to be possible, you must have an impeccable record of all the hours worked by the employees. 

Why? 

Because an accurate record will ensure that the employee receives the right amount of either money or free time. 

As an employer, you need to keep records of overtime hours, wages, and regular hours worked for 36 months. Otherwise, you may face up to CAD 10,000 (USD 7,326) in fines — and even more for unpaid overtime.

Canadian law states that you can track employees’ working hours from company-owned devices.

Note that exempt categories of employees aren’t protected by the Canadian Labor Code. These categories include different positions, such as: 

• Executive,
• Administrative,
• Professional,
• Highly compensated,
• Computer, and
• Outside sales.

If you have employees in these positions, you don’t need to keep track of their time. For all the other positions, however, you should prioritize proper time tracking to comply with the law. 

Time tracking regulations in India, the country renowned for long working hours

According to Employment and Labor Laws in India, employers can monitor company-owned devices. Similarly, the Information and Technology Act stipulates that personal devices can only be accessed with the written consent of the owner. 

As an employer, you must keep track of employees’ attendance and wages for 3 years.

According to the Occupational Safety, Health, and Working Conditions (OSH) Code, employees must not work more than 60 hours a week, including overtime. This means that the maximum number of hours an employee can work during the day amounts to 10.5. 

Interestingly, the regular workweek is 48 hours long and is one of the longest workweeks in the world. 

Overtime is limited to 2 hours daily and is worth double the regular hourly rate. When it comes to breaks, every 5 hours of continuous work is followed by a 30-60-minute break. 

Finally, every employee is entitled to 24 hours of uninterrupted rest during the week and 12 hours between shifts. 

Time tracking regulations in the EU zone before and after plenty of unreported overtime hours

All EU member states follow the European Working Time Directive (EWTD) — an EU regulation that covers workers’ rights regarding working hours and time tracking. Time tracking wasn’t mandatory in the EU until 2019 — and it became mandatory for a reason.

For a while, the EU took pride in their workers’ high productivity levels coupled with short workweeks. They were seemingly working fewer hours than anyone else, all while achieving amazing results. 

Ultimately, it turned out that many EU workers had plenty of overtime hours that went unnoticed by the government. 

In 2019, the European Court of Justice’s ruling brought this practice to light, making it mandatory for employers to create a system for time tracking that’s “objective, reliable, and accessible.“ 

However, The EU member states have the right to introduce their own additional and more specific laws regarding time tracking. 

We’ll now see some examples of EU states that have done so and examples of those that haven’t. 

Time tracking regulations in Spain — enhanced by the Royal Decree Law

Spain was the very first country to integrate time tracking regulations after the European Court of Justice ruling. Already in May 2019, the Spanish government has proceeded with new regulations. 

Namely, the Royal Decree Law brought about big changes when it came to protecting employees from mistreatment.

For example, if you’re doing business in Spain, you must keep time tracking records for 4 years. These records include data about the start and end of each day, break length, and overtime hours. 

Additionally, you must track the time of all employees, regardless of whether they’re paid hourly or monthly. 

Time tracking regulations in Germany — Draft Bill in action

The Ministry of Labor and Social Affairs proposed a Draft Bill implemented in April 2023. Since the EWTD doesn’t provide specified instructions on time tracking methods, the authorities have decided to set clear legal requirements, including:

• Depending on their size, companies have between 1 and 5 years to implement a legal electronic time tracking system. 
• Failure to implement an electronic time tracking system can result in a fine of up to EUR 30,000 (USD 32,187).
• Employers have to record the beginning, end, and duration of the work employees perform. 
• Employees have the right to view electronic records and have a copy for themselves. 

You can delegate the recording of working hours to employees. In this way, you create an atmosphere of trust in the team. 

Recording working hours and spotting irregularities is fairly easy with a digital tracking system. 

Time tracking regulations in France — or lack thereof

The French still show no sign that they’ll recognize the European Court of Justice ruling. This means they haven’t introduced a system for time tracking that’s “objective, reliable, and accessible“ — at least not officially.

The French Labor Code requires time tracking only when employees don’t work under collective working hours (Article D.3171-8). In that case, here’s what you need to record: 

• The start and end of each work period, or the total number of hours of work completed.
• The amount of hours that employees work each week. 

But, apart from the one above, the French Labor Code doesn’t have other time tracking requirements. 

However, if you’re an employer in France, you’re welcome to introduce time tracking on your own to define paychecks more easily — and keep track of employees’ attendance records. 

Pre-Brexit and post-Brexit time tracking regulations in the UK 

The European Working Time Directive was introduced in 1993, when the UK was still part of the EU — and the European Court of Justice ruling happened in 2019. 

Since Brexit took place in 2020, the UK still follows the EWTD’s time tracking regulations. 

Like in EU member states, UK employers are obliged to keep records of all employees’ working hours. The records showcase whether minimum daily and weekly rest periods and overtime have been complied with under the EU time tracking law. 

When it comes to other time tracking regulations, the UK refers to the Working Time Act 1998.

As in most countries, some categories of jobs are excluded from time tracking. Here’s a list of job categories exempt from time tracking in the UK:

• Aviation,
• Sea transport jobs,
• Managing executives,
• Certain healthcare roles,
• Security and surveillance jobs, and
• Armed forces, the police, and emergency service jobs.

For non-exempt employees, the Working Time Act states that you can create, maintain, and keep the records ‘in such manner and format as the employer reasonably thinks fit.’

This implies that you can use both digital and manual spreadsheets for record keeping. 

When time tracking is the question, Clockify is always the answer

The only thing you need to comply with time tracking regulations for your local and global employees — is reliable, easy-to-use software. 

Clockify is all that and more. 

As a straightforward tool that makes time tracking and record-keeping a breeze, Clockify can also help you remain compliant with timekeeping laws. 

On an easy-to-use platform, employees can quickly enter their hours manually or by starting the timer. 

On top of that, Clockify comes with a handy reports feature that’ll help you get an overview of everyone’s time within seconds. 

Time tracking doesn’t have to be hard. Join the community of millions of satisfied employers who’ve been successfully tracking time for years.