Hourly Employee Time Tracking Software: The Complete Guide For Small Business Owners

The hidden costs of manual time tracking add up fast. Beyond the obvious time theft, overtime miscalculations can trigger labor law violations, manager hours wasted on timesheet processing, and zero visibility into what each shift actually costs you.

Hourly employee time tracking software fixes these problems. The right system can eliminate buddy punching, automate timesheet processing, prevent overtime violations, and give you the labor data you need to schedule smarter. This guide shows you what to look for, how the major platforms compare, and how to implement time tracking without employee resistance.

TL;DR: Hourly employee time tracking software

Essential features: Mobile-first clock-in, GPS location verification, automatic overtime alerts, break compliance tracking, scheduling and payroll integration, manager approval workflows, and reporting that shows labor costs by shift and location.

Free vs. paid: Free plans work for small teams (1-10 employees) with basic needs. Upgrade to paid ($3-$8 per employee monthly) when you need GPS verification, labor forecasting, or advanced compliance features. Even 2% payroll savings covers software costs.

Top options: Homebase (best all-in-one with free Basic plan), Clockify (free unlimited users but limited features), QuickBooks Time (accounting integration), Deputy (complex scheduling), When I Work (straightforward paid option), Time Clock Wizard (flat-rate pricing).

Implementation: Communicate why you’re switching, test software yourself first, train managers before employees, run parallel systems for one week, address resistance directly, and optimize after 30 days.

Avoid these common mistakes: Choosing based on price alone, ignoring mobile experience, picking project-based software for shift workers, overlooking integration needs, and skipping employee input during selection.

{{banner-cta}}

Why hourly employee time tracking software matters for small businesses

Manual time tracking costs you more than you realize. Every rounded timesheet, every buddy punch, every forgotten clock-out adds up. For a 10-person team, even 10 minutes of time theft per employee per day costs you over $10,000 annually.

Hourly employee time tracking software solves specific, expensive problems:

• Stop paying for time not worked: Manual timesheets make it easy to round up hours or have coworkers clock in for each other. Digital time tracking with GPS verification eliminates buddy punching and time padding immediately.
• Ensure overtime compliance and avoid penalties: Miscalculating overtime is expensive and illegal. Time tracking software automatically flags when employees approach 40 hours and calculates overtime correctly every time. 
• Save manager time on timesheet processing: Cloud-based time tracking software cuts timesheet processing from hours to minutes with automatic data capture and payroll integration. 
• Improve scheduling accuracy: When you know actual labor costs per shift—not what you scheduled, but what you actually paid—you can schedule smarter and stop bleeding money on unnecessary overtime. 
• Protect your business legally: The Department of Labor requires accurate time records for all hourly employees. Automated timesheet systems create the documentation trail you need if you’re audited or sued. 

Essential features to look for in hourly employee time tracking software

When evaluating time tracker software for your hourly team, prioritize these features: 

• Mobile-first clock-in: Your employees aren’t at desks—they’re on the floor, at job sites, or moving between locations. A free time tracking app that works on phones is non-negotiable for hourly workers. 
• GPS location verification: GPS confirms people are at work when they clock in and helps manage multiple locations, especially useful for businesses with multiple job sites or remote teams.
• Automatic overtime tracking and alerts: Get alerts before employees hit 40 hours so you can adjust schedules before expensive overtime kicks in.
• Break and meal period compliance: Track breaks, flag missed breaks, and create documentation proving you’re following state labor laws.
• Integration with scheduling and payroll: Your time tracking tool needs to talk to your scheduling software and payroll system so data flows automatically without manual entry. 
• Manager approval workflow: Employees should be able to request timesheet edits while managers review and approve changes with full audit trails. 
• Timesheet editing and correction: Your software needs to allow corrections while maintaining logs of who made changes, when, and why.
• Reporting and analytics: See labor cost by shift, employee, location, and as percentage of revenue.
• Employee-friendly interface: If employees can’t figure it out in 30 seconds, you’ll spend weeks dealing with adoption problems.
• Reasonable pricing for small teams: Look for transparent pricing with no hidden fees—some platforms offer free time tracking software for smaller teams.

Free vs. paid time tracking software: What’s right for your business?

The right answer depends on your team size, complexity, and how much manual work you’re willing to tolerate.

When free time tracking software works: Free time tracking software works best for very small teams (1-10 employees), single location businesses, simple clock-in/out needs, or testing before committing to paid software.

Free options typically include basic clock-in/out, manual timesheet entry, simple reporting, and mobile apps. Homebase offers free time tracking plus scheduling and team communication for one location, including clock-in on multiple devices, timesheet storage for 90 days, and real-time messaging. Clockify provides free access for unlimited users but lacks GPS and scheduling integration.

What you don’t get with free plans: GPS verification, advanced overtime tracking, labor cost forecasting, priority support, or advanced payroll integration.

When paid time tracking software makes sense: Upgrade when you need GPS verification to prevent buddy punching, multiple location management, advanced overtime and break compliance, payroll integration, scheduling combined with time tracking, or priority support.

Standard plans run $3-$8 per employee per month (Homebase, When I Work, Deputy), while Enterprise plans often cost $10-$20 per employee per month (QuickBooks Time, ADP). If time tracking software saves just 2% of payroll costs, it pays for itself—a business spending $50,000 monthly on labor saves $1,000 per month versus a $200 software cost.

Our recommendation: Start free, upgrade strategically: Free software often means limited features and manager time spent on workarounds. If your free software requires 5 extra hours of manual work weekly, you’re losing money.

Start with Homebase’s free plan for real time tracking with GPS, scheduling, team communication, and basic reporting. Upgrade to paid features only when you need them for specific problems.

Top hourly employee time tracking software options (2026)

Here's how the major players compare for small businesses with hourly teams:

1. Homebase: Best all-in-one for hourly teams

Homebase combines time tracking, scheduling, and team communication in one platform built specifically for hourly workers. The free Basic plan includes building weekly schedules, clock-in on tablets/computers/POS devices, timesheet storage for up to 90 days, real-time team messaging, mobile app access, integrations, and 24/7 AI chat support.

Best for: Restaurants, retail shops, healthcare, and service businesses that need scheduling and time tracking to work together seamlessly.

Pricing: Free Basic plan for one location. Paid plans start at $24/month per location for advanced features like GPS verification, labor cost forecasting, and more.

Why it stands out: Most “free” software limits users or features aggressively. Homebase's free plan includes core scheduling and time tracking functionality, making it genuinely useful for small teams getting started.

2. Clockify: Best free option for unlimited users

Clockify offers completely free time tracking for unlimited users with no feature restrictions based on team size. Good for project-based tracking but less ideal for shift workers.

Best for: Very small businesses testing time tracking, or teams that need project time tracking more than shift management.

Pricing: Free forever plan available. Paid plans add features like GPS and advanced reports.

Limitations: No built-in scheduling, basic overtime tracking, and limited integration with payroll systems compared to platforms built for hourly teams.

3. QuickBooks Time (formerly Tsheets): Best for accounting integration

If you already use QuickBooks for accounting, QuickBooks Time integrates seamlessly. Strong GPS tracking, robust reporting, and job costing features make it popular with contractors and field service businesses.

Best for: Businesses already using QuickBooks who need tight accounting integration.

Pricing: Starts at $8 per user per month plus $20 base fee.

Limitations: Expensive for larger teams, and the interface feels more accounting-focused than employee-friendly.

4. Deputy: Best for complex scheduling needs

Deputy excels at advanced scheduling with demand forecasting, auto-scheduling, and compliance management. Time tracking integrates well with scheduling features.

Best for: Larger teams (25+ employees) with complex scheduling requirements across multiple locations.

Pricing: Starts at $5 per user per month.

Limitations: Overkill for small teams, steeper learning curve than simpler platforms.

5. When I Work: Good scheduling + time tracking combo

When I Work combines scheduling, time tracking, and team messaging. Clean interface and reasonable pricing make it popular with retail and hospitality.

Best for: Small to mid-size teams that want scheduling and time tracking together.

Pricing: $2.5/user/month for single location or schedule; $5/user/month for multiple locations and schedules. 14-day free trial available. 

Limitations: No ongoing free plan means you’ll need to budget for ongoing software costs, unlike Homebase which offers a robust free tier.

6. Time Clock Wizard: Best for mid-sized team on a budget

Time Clock Wizard offers robust features, including scheduling, time tracking with GPS and photo capture, task management, PTO tracking, and payroll reporting with an unusual pricing structure.

Best for: Teams that want full features at predictable flat-rate pricing rather than per-user costs.

Pricing: Free (basic only), $29.95/month unlimited users (limited features), Pro plans $49.95-$109.95/month for up to 50 users.

Limitations: Confusing pricing tiers with trade-offs between user limits and features. Teams larger than 50 users need Enterprise pricing.

How to choose hourly employee time tracking software

Choosing the right time tracking software comes down to matching features with your actual needs—not what sounds impressive in marketing materials.

Start with these questions:

• Need scheduling + time tracking together? → Homebase (free for up to 10 employees, one location)
• Want completely free for unlimited users? → Clockify (but expect limited features for shift workers)
• Already use QuickBooks for accounting? → QuickBooks Time (seamless integration but pricier)
• Need advanced scheduling with demand forecasting? → Deputy (built for larger, complex teams)
• Want a straightforward paid option? → When I Work (good balance of features and pricing)
• Prefer flat-rate pricing over per-user costs? → Time Clock Wizard (confusing tiers but potentially cheaper for larger teams)

Beyond the basics, consider:

• How many employees do you have? 
• Do you need scheduling integration? 
• Does the software integrate with your payroll system?
• How tech-savvy is your team? 
• Do you have multiple locations? 
• What’s your budget?

Understanding how to track employee’s time effectively means choosing software that matches your actual workflow instead of forcing your team to adapt to rigid software.

{{banner-cta}}

How to implement time tracking software with your hourly team

Choosing software is the easy part. Getting your team to actually use it is where most businesses struggle. Here’s how to roll out time tracking without the resistance:

• Step 1: Communicate the “why” before the “how.” Explain the real reasons—accurate pay, labor law compliance, and less manager paperwork. Emphasize employee benefits like easy schedule access. Give at least one week’s notice.
• Step 2: Choose a mobile-first system and test it yourself. Use the software yourself for a few days before rolling out to your team. If you can’t figure it out easily, your employees won’t either.
• Step 3: Train managers first, then employees. Managers need to be experts before employees start using the system. Hold manager training sessions, then have managers train their teams in short 10-minute sessions during shifts.
• Step 4: Run parallel systems for the first week. Run both your old system and new software simultaneously for one week as a safety net. After one week, switch over completely.
• Step 5: Address resistance and concerns directly. Common pushback includes “You don’t trust us” (this protects both parties if there’s a dispute), “It’s too complicated” (let me show you—it’s simpler than spreadsheets), and “I don’t want to be tracked” (we only track clock-in/out times). Address concerns head-on instead of dismissing them. 
• Step 6: Review and optimize after 30 days. Check what’s working and what’s frustrating. Make adjustments based on real usage patterns.

Implementation mistakes to avoid

• Don’t surprise employees: Give 1-2 weeks notice before launch.
• Don’t make it optional: Letting some employees use spreadsheets while others use digital creates chaos and inequity.
• Don’t skip manager training: Undertrained managers become bottlenecks.
• Don’t ignore feedback: If employees consistently say something isn’t working, listen and adjust.

Want more implementation support? Time and attendance software guides help you plan rollouts that employees actually adopt.

Watch out for these mistakes when choosing time tracking software

The wrong time tracking software creates more problems than it solves. Avoid these common pitfalls that lead to wasted money, frustrated employees, and software you’ll abandon in six months:

• Choosing based on price alone: If free software requires 5 extra manager hours weekly to process timesheets manually, you're not saving money. Calculate total cost including implementation time, training, and ongoing manual work.
• Ignoring mobile experience: Test the mobile app before committing. Can employees clock in with one tap? Does it work on older Android phones? Is GPS accurate?
• Picking project-based software for shift workers: Tools like Toggl and Harvest excel at project tracking but are terrible for shift workers who need simple clock-in/clock-out functionality.
• Not considering integration needs: Your time tracking tool needs to integrate with your payroll and scheduling software. Before choosing, verify integrations exist. Most time trackers boost productivity only when they eliminate manual work.
• Overlooking scheduling integration: Time tracking works best when connected to scheduling. Separate tools create disconnected workflows.
• Skipping employee input: Have a few employees test your top 2-3 options before deciding. Employee buy-in during selection dramatically improves adoption later.

FAQ: Hourly employee time tracking software

What software is used to track employee hours?

Popular options include Homebase (free Basic plan for one location), QuickBooks Time (best for QuickBooks users), Clockify (free for unlimited users), Deputy (complex scheduling), and When I Work (good all-around). Choose based on team size, scheduling needs, and payroll integration requirements.

Is Clockify really free?

Yes, Clockify offers free time tracking for unlimited users with no time limit. You get basic tracking, reporting, and project management but no GPS, advanced reporting, or priority support—features that matter for shift workers.

Is Google TimeSheet free?

Google doesn’t offer dedicated timesheet software. Google Sheets can create manual timesheets, but that's not automated time tracking. For actual clock-in/clock-out functionality, use dedicated software like Homebase or Clockify.

How to keep track of staff hours?

Use cloud based time tracking software with mobile clock-in. Employees clock in from their phones, the software calculates hours, tracks breaks, flags overtime, and sends data to payroll. GPS verification prevents buddy punching while manager approval workflows maintain accuracy.

What’s the difference between time tracking for hourly employees vs. freelancers?

Hourly employees need simple clock-in/clock-out with overtime tracking and scheduling integration. Freelancers need project-based tracking with billable hours and invoicing. Toggl and Harvest excel at freelancer tracking. Homebase is built for hourly shift workers.

Do employees need to clock in from the exact work location?

Most apps let you set a GPS radius of 500-1000 feet to account for parking lots or poor signal. Adjust based on your needs: some require strict on-site clock-in, others allow flexibility for mobile workers.

Can managers edit employee timesheets?

Yes, most software includes manager approval workflows. Employees request changes for forgotten punches, managers review and approve. The system logs who made changes, when, and why—this creates an audit trail while allowing legitimate corrections.

Does time tracking software integrate with payroll?

Most modern software integrates with QuickBooks, Gusto, ADP, and Paychex. Hours export automatically to payroll, eliminating manual entry. Some platforms like Homebase offer integrated payroll as an add-on.

How much does time tracking software cost?

Free options exist (Homebase Basic, Clockify). Standard plans cost $3-$8 per employee monthly. Enterprise plans run $10-$20 per employee monthly. Even 2% savings in payroll costs typically covers software expenses.

Conclusion: Choose the right time tracking software for your hourly team

The right hourly employee time tracking software stops time theft, prevents overtime violations, saves manager hours, and gives you data to schedule smarter. Start by matching software to your actual needs—small teams benefit from Homebase’s free Basic plan, QuickBooks users should consider QuickBooks Time, and larger teams might need Deputy’s advanced features.

The most important factor? Whether your team will actually use it. Choose mobile-first software employees can figure out instantly, test it yourself first, and address resistance head-on during rollout.

{{banner-cta}}