![How to Effectively Track Billable Hours [+ Examples]](https://www.datocms-assets.com/16247/1721759403-clockshark-blog-track-billable-hours.png?w=1200&auto=compress,format)
Tracking billable hours can feel like a hassle, right? But for field service managers, it's the key to ensuring your team’s hard work translates into accurate billing. Understanding and putting effective tracking methods into place can significantly boost your efficiency and, more importantly, your bottom line. Let's dive into the essentials of billable hours law and how to manage them effectively.
What are Billable Hours and How Do They Work for Field Service Managers?
Billable hours are the lifeblood of any field service business. They represent the time your team spends working directly on tasks that you can charge your clients for. Think of it like this: if your crew is out there installing, fixing, or consulting on a project, those hours are billable. Every minute counts towards your revenue, making accurate tracking crucial.
For instance, imagine you run a small electrical contracting business. One of your electricians, Sam, spends six hours installing new wiring at a client’s site. These six hours are billable because they directly contribute to the completion of a client task. Logging these hours correctly ensures you get paid for all the work your team puts in.
Billable vs. Non-Billable Hours: Key Differences and Management Strategies
Understanding the distinction between billable and non-billable hours is vital for profitability. While billable hours are straightforward, non-billable hours include tasks like training, administrative work, and travel time that, although essential, aren’t directly chargeable to a client.
Billable Hours Tracking
Scenario: Sam, our electrician, spends six hours installing electrical wiring at a client's site.
Tracking Method: Using ClockShark’s mobile time-tracking app, Sam logs the hours under a specific job code for the client project. The time is automatically categorized as billable since it directly contributes to the completion of a client task.
Non-Billable Hours Tracking
Scenario: Sam spends two hours attending a mandatory safety training session.
Tracking Method: Sam logs this time under a different job code specifically created for training and development. This time is categorized as non-billable since it is not directly related to client work but is necessary for overall job performance.
By clearly differentiating between billable and non-billable hours, you can better manage your team's productivity and ensure all work is accounted for correctly.
Travel Time Management
Scenario: Meet Jane, another electrician. Jane travels for one hour to reach a client's site and another hour to return.
Tracking Method: Jane logs her travel time separately under a designated travel job code. Depending on your company's policy, this could be either billable or non-billable. If the client is charged for travel, it becomes billable; otherwise, it remains non-billable.
Administrative Tasks
Scenario: Back at the office, your admin assistant, Tom, spends three hours preparing invoices and scheduling jobs for the week.
Tracking Method: Tom logs this time under an administrative job code. While these hours are non-billable, they are essential for the smooth operation of your business.
How to Track Your Team’s Billable Hours
Accurate tracking of billable hours can be streamlined with the right tools and practices. Here are some strategies to help you get started.
Implement Automated Time Tracking Tools
Automated tools like ClockShark’s mobile time-tracking app simplify the process of logging hours. Employees can clock in and out directly from their smartphones, and the data is synced in real-time to your central system.
Scenario: Sam finishes his wiring job and logs his time on the spot. The time is instantly synced, allowing you to review it without delays.
Regularly Review and Approve Timesheets
Set aside time each week to review and approve timesheets. This ensures accuracy and allows you to address any discrepancies promptly. Encouraging your team to log their hours daily can also reduce errors and missed entries.
Scenario: At the end of the week, you notice Jane has accidentally logged an extra hour under a client project. By reviewing the timesheets, you can quickly correct this and ensure accurate billing.
Set Clear Guidelines and Provide Training
Make sure your team understands what constitutes billable and non-billable hours. Provide training on how to use your time-tracking tools and establish clear guidelines for logging time. This can prevent confusion and ensure consistent practices across the board.
Scenario: During a team meeting, you explain the difference between billable and non-billable hours using real examples from your projects. This clarity helps your team log their time correctly.
Utilize Detailed Job Codes and Descriptions
Create specific job codes for different types of tasks. This helps in categorizing the work accurately and provides a clearer picture of how time is being spent. For example, have separate codes for client projects, training, administrative tasks, and travel.
Scenario: Tom uses detailed job codes to categorize his time spent on invoicing, client communication, and scheduling. This detailed logging helps in analyzing where administrative time is being spent and optimizing processes.
Why Should Field Service Managers Calculate Billable Hours?
Calculating billable hours is crucial for several reasons:
- Accurate Invoicing: Ensures you bill clients correctly for the work done, reducing disputes and improving cash flow.
- Performance Tracking: Helps in monitoring team productivity and identifying areas for improvement.
- Profitability Analysis: Provides insights into how profitable each project is and helps in better project planning and pricing strategies.
- Resource Allocation: Aids in efficient resource allocation by understanding how time is being utilized across different tasks.
Best Practices You Can Gain by Tracking Billable Hours
Adopting best practices for tracking billable hours can significantly enhance your operational efficiency. Here are some to consider.
Mobile Time Tracking for Accurate Billable Hours
Mobile time tracking is a game-changer for field service managers. Your team can log their hours from anywhere, ensuring accurate and up-to-date records. For example, if Sam finishes his wiring job at the client’s site, he can immediately log his hours through the ClockShark app, ensuring no time is lost or forgotten.
Learn more about the painless shift to paperless tracking with ClockShark.
GPS Time Clocks to Streamline Tracking
GPS time clocks offer an added layer of accuracy by verifying the location of your team when they clock in and out. This is particularly useful for field services where employees are constantly on the move. Imagine Sam checks in at the client's location; the GPS feature confirms his presence there, ensuring the hours logged are indeed billable.
Explore ClockShark’s GPS time clock for workers.
Kiosk Clocks for Effective Management
For sites with multiple workers, kiosk clocks can be an efficient solution. These systems allow multiple employees to clock in and out from a single device, reducing the need for individual time-tracking devices and streamlining the process.
Scenario: On a large construction site, workers use a central kiosk clock to log their start and end times. This ensures everyone’s hours are accurately recorded without needing multiple devices.
Geofencing Technology for Enhanced Time Tracking
Geofencing technology can further enhance your time-tracking accuracy. By setting up virtual boundaries around job sites, you can automatically track when employees enter and leave the area. If Jane enters the designated job site, the system will automatically start tracking her time, eliminating the need for manual entries.
Check out how ClockShark’s GPS tracking works.
Web Punch Clocks for Office and Remote Workers
For tasks that need to be done from an office or remotely, web punch clocks offer a convenient solution. Employees can log their hours from their desktops, ensuring all work is tracked, regardless of location.
Scenario: Your remote office manager, Lisa, logs her hours using a web punch clock while working from home. This ensures her administrative time is accurately recorded alongside fieldwork.
Optimize Your Billable Hours Today!
Tracking billable hours effectively is not just about getting paid accurately; it's about understanding and optimizing your team's productivity. By leveraging tools like ClockShark and implementing best practices in the construction industry, you can ensure every billable hour is captured, leading to better invoicing, improved cash flow, and a more efficient operation.
Embrace these strategies and tools, and you'll find that managing billable hours law becomes a seamless part of your daily operations, leaving you more time to focus on growing your business and delivering top-notch service to your clients.
Tracking billable hours might seem like a small detail, but it makes a big difference. Get started today and see the impact on your business.
