EC Time tipps and hints Nr. 7: Negative time vs. positive time

Hello,

I am often in meetings with different people from lots of areas – sales, pre-sales, consultancy, development – and terms are thrown through the phone line or room and I often get the impression that we do not have the same understanding of very important, fundamental basics in time management. And this is true for the very fundamental questions: what is negative time recording, what is positive time recording. Often negative time recording is thought off as being absence recording only. And often positive time recording is thought off as being a time recording with clock in / out punches only. Which is both not correct.

So, let me try to explain fundamental basics in Time Management. It can be that this terms are indeed somehow SAP-specific terms and have been widespread due to the large SAP ERP Time community, but actually I doubt it. Cause each person who is deep into time management (regardless on the software system solution) understand more or less the same with this terms. And for EC Time we use this concept as well.

Hence, let me try to set a common understanding for basic terms / principles. And I am open for discussion here cause I don´t know if there are countries in the world where real business practice is different from what I describe below. But based on 20 years experince in time management I would dare to say following:

There are in general a handfull of different time recording methods from an HR perspective. And this can be differentiated in:

Absence time recording, negative time recording and positive time recording. What is understood with this time recording methods?

1.  Absence time recording

Customers using this method for a group of employee demand NOT an attendance time recording. The employees need only to record their absences times. Absences in the sense that an employee is NOT acting for the employer during this time. An absence is for example a sickness, vacation, jury duty or any other business reason a customer needs to track for their employees due to payroll or compliance reasons.

An absence can deduct a time account. A time account (or in SAP ERP terms: quota) represents a specific amount of absence days an employee is entitled for. Vacation for example. Due to the fact that vacation is a paid day off an employee cannot have unlimited vacation days. Would be nice, but no chance ;-). But not only vacation does deduct a time account, there can be others as well. In Europe an illness does not deduct a time account but in US and other states there are specific paid sickness entitlements that are deducted by a sickness record.

Due to the fact that a time account can be deducted there must be mechanisms to calculate the accrual or entitlement. This rules can be very complex.

Absences in general can be paid (most of them) or unpaid. And when they are paid usually different variants exist. Base pay only, average pay of the last 3 months income or the famous as-if-payment which is: An employee gets paid as if he had worked – with all the premium pays for Sunday work when he was planned on a Sunday or shift differentials. At least in Germany this kind of payment exists.

So, are home office, travel time, business travel absences things that need to be recorded in the absence time recording scenario? No. Cause to decide if a specific type is an absence or an attendance you simply need to answer the question:

Is the employee during his activity acting for the employer or not? For vacation, sickness and so on he is clearly not. But home office – employee is active and working. Business travel, travel time – as well. In a strong sense this kind of activities are not regarded as an absence but as an attendance.

For absence recording especially when time accounts are used the employees need to have a workschedule. Cause otherwise a system would not be able to find out how many days to deduct from a time account when a 3-weeks vacation is recorded.

This is it. Absence recording in a few words. In EC Time this variant is also spoken off as “Time Off”. But you might find other terms out there as well for it. Some customers call it “Vertrauensarbeitszeit” – which is a kind of “trusted working time” due to the effec that the employees do not record their real hours worked, but only absences.

Now lets get to the second level:

2. Negative time recording

Many think negative time recording is the same as absence time recording. But big, big mistake. Negative time recording is much more. And especially in Germany negative time recording is in many cases much more complicated than for example positive time recording. Negative time recording is often used in Germany in the manufacturing area where you have rotating shifts like early, late, night. Employees can´t come to work when they want to, cause there is a fix shift pattern. And if they are not present at the shift begin the assembly line stops. In easy words ;-).

A negativ time recorder does not need to record his working time. The employees workschedule is used as actual working time. This is why he does not need to record his attendance times explicitly. However, a negativ time recorder needs to record the “deviations” from the workschedule. A deviation is something where he has not worked “as planned”. A deviation can be an absence record – he came late, he leaves earlier. He is ill or on vacation. But a deviation can also be different times he has worked than his workschedule did foresee. He worked longer – then this part needs to be recorded. But only the part that is not already covered by his work schedule. Or he was a full day or partial day on a training and the customer pays this differently or simply want this special case to be documeted. Or business travel. Or home office. In short: anything that is not covered with his workschedule or needs to be documented with a special timetype needs to be recorded as a deviation.

The recorded times get than mingled with the employees workschedule and the result are the actual hours worked. The recordings can be duration based or start / end time based – this depends on how the customer wants to track the employees recordings and of course if there are start / end time based premiums like for example night premiums after 20:00. Then you need to have the start / end times in the system in order to generate the correct payments.

An example.

Employee has got a workschedule from 06:00 – 14:00. He came punctually to work but worked 2 hours longer. What does he need to record? Only the deviation which is: Working time from 14:00 – 16:00. The system generates based on the workschedule automatically the “normal” planned hours from 06:00 – 14:00 as hours worked.

Same employee wants to take time off tomorrow from noon onwards. What does he need to record? Only an absence from 12:00 – 14:00. For the rest system takes the planned hours and converts it into hours worked.

The employee was on an internal training from 11:00 – 13:00 to learn how to be punctual at work. Unfortunately this training comes to late cause he was late for work on this day for 2 hours. What does he need to record?

Easy now: an absence from 06:00 – 08:00 that covers the late coming part (cause the absence time is not paid or differently paid than hours worked) and he needs to record an attendance time type from 11:00 – 13:00. The remaining hours get systemgenerated based on the workschedule. So in the end the employee has following records:

06:00 – 08:00 absence late coming (recorded)
08:00 – 11:00 working time (system generated)
11:00 – 13:00 training (recorded)
13:00 – 14:00 working time (system generated)

That´s negative time management. Most important message: for negative time management employees need to record only the deviations from the work schedule.

But what kind of employees is the negative time management method applied? Well, this can´t be easily answered. This differs from country to country, from industry to industry.

Lets just have a look on some examples:

In Germany in manufacturing area negative time management is very common. This employees are salaried employees (as most employees are in Germany) and they work in fix shift patterns, often so called 3-continous rotating shifts which is 24hours/ 6 or 7 days production. Take car manufacturing for example. These employees need to be at the assembly line when the shift starts, otherwise the production process gets disrupted. Hence they can´t work flexibly and come and go as they want. Fix shift patterns, fix work begin, fix break times. Each employee of the shift group has to be present and punctual. Hence, no need to record the working time, but only the deviations. When you want to use some old-fashioned terms from the history, you can call this employee groups the “blue collars”.

And here you can see the difference in time management philosophy in Europe and the United States which sometimes makes communication difficult cause each participant argues based on his own cultural background:

In US time management methods are completly the other way round as in Germany / Europe. In US there is the big differentiation between so called exempt salaried employees (exempt from overtime pay) and non-exempt hourly employees. The exempt employees are rather “absence only recorder”. But there are also salaried employees who receive an overtime pay. This employees are rather negative time recorders. But the non-exempt hourly employees are generally positive time recorders. They get paid each minute they work and when they work longer than planned (or longer than for example 8 hours a day) they receive an overtime pay. Often this employees are spoken of “blue collars” whereas this old-fashioned term really does not fit into the complexity of nowadays world anymore.  

And again, not only the target group of positive time / negative time is often different in Germany / Europe compared to US, but also the question on salaried / hourly pay: positive time recording is rather applied in Germany / Europe for administration employees an is rather for salaried employees (although hourly pay exists as well for temporary workers) . Salaried positive time employees working rather not in shifts, but in flextime which is a model where employees can themselve decide within certain boundaries how long they want to work on each day. They can work longer on specific days and do not get an overtime pay for it, but the hours are transferred to a flextime account. When they want to leave earlier on fridays or on other days they do not have to request for a leave (as a negative time recorder would have to)  but just leaver earlier. The minus hours on this day gets balanced out in the flextime account by working longer on other days.

For employers this method is quite useful cause they are not obliged to pay overtime pay each minute the employee works longer. And for employees this flexibilty allows to balance out days with lots / less workload and to accomodate private life more with working life / duties.

I don´t know a US customer where this “flextime” model is applied – but might be wrong.

As I already have touched the “positive time recording method”, lets look a bit more in detail onto it:

3. Positive time recording:

Positive time recording is pretty simple explained: The employee has to record all his times. Absences and attendances. The employees workschedule defines when an employee has to work. Is there no recorded time on a planend day it is as if the employee was not present and did not perform any work. Due to the fact that there is not even an absence record we can assume an unexcused non-attendance. A record must exist: either absence or attendance.

Always imagine for positive time recorders: when they do not record times it is as if they don´t get paid for this day.

As already mentioned positive time recording is widely used in Germany / Europe for salaried adminstration employees. Banking sector, insurances, software industry or any other kind of administrative tasks. And very often positive time recording comes in one way or other with flextime accounts or time off in lieu accounts.

So, quite easy: all times need to be recorded.

But how are the times recorded?
This differs as well. It can be a time sheet where employees record their working times either duration based or with start / end times. But it also can be a time recording terminal where a time card is swiped, a web clock that creates an automated punch when the employee logs into a system, biometrical device or mobile device that creates single time events and a logic must be applied automatically to create out of single punches a time record with start / end times or calculate the duration out of it for flextime calculation, overtime calculation or any other HR-relevant calculations there might be. But you also find that sometimes a decentral time administrator records the attendance times for a group of employees (which would be a bit old-fashioned).

But what about project time recording or customer billing time recording. Is this positive time?

Well, it depends ;-). I would say where this project hours / WBS hours / internal order hours and so on are used for time evalution purpose as well and where this employees when they do not work for a customer need to record a different attendance type like “administration”; “training” or whatever, then yes. It is positiv time. Cause they need to record all their hours.

But you find also customers where the “CATS” (cross application time sheet) hours are not used for HR purpose – but only for billing or project administration. Hence no integration from CATS to Payroll. And these employees are then rather no positive time recorders from a time management perspective. Cause these hours are not used for overtime calculation, flextime calculation or for any other HR purposes. But honestly, this is a kind of grey area. Some are, some aren´t. Some consultants recorded hours that are billed are used for time evaluation purpose to generate overtime pay, some are not. This really depends from customer to customer.

But the most important thing to remember is for a positive time recorder:
This employee needs to record ALL his times. Absences and attendances. The planned working time is only an orientation, gives only the days / times when an employee is supposed to perfrom work.

So, to recap, most important messages:

Absence recording:
Employees record only their leave times. Illness, vacation.

Negative time:
The employees workschedule are the hours worked – unless the employee records deviations. Deviations can be absence times but also attendance times. The attendances can be within the planned working time (training, travel time or any other attendance that might be paid differently or need to be documented) or outside the planned time like overtime.

Positive time:
An employee has to record all of his absence and attendance times. Work schedule is only used to derive the planned time and to check if an employee needs to record working time / absence time on a day.

In Employee Central time management you define if an employee is a negative time or positive time recorder with the so-called “time recording profile” that is assigned to the employee in the job information. The time recording profile bundles all time valuation rules together and you choose if a time recording profile has got the time recording method positive time, overtime, negative time or absences only. You might ask why is there an entry “absences only”. This employees do not need a time recording profile at all cause they use only time off and no time sheet. True, regard it rather as a historical technical thing. I can´t imagine a use case where you would need this option to be honest.

That´s it in a nutshell. I bet you made some different experiences than me out there in the real time world, cause time management is simply so heterogenous that black / white schemas can´t be applied. There is one customer living and doing time management completly different than another customer in same country, same branch, same trade union area. And than there are many countries, many branches….  You are welcome to share your different views, different experiences. I am always eager to learn different things.

Otherwise I hope this helped a bit in clarifying some basic principles / terms in time management.

Best regards

Volker