# Time clock for a small store: what the law asks

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# Time clock for a small store: what the law asks

Federal law does not require a time clock, but it does require complete and accurate records of hours worked, so here is what to keep and for how long, how rounding works, the five ways small stores track time, and what to look for in a time clock app.

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[Titus Capilnean](https://www.linkedin.com/in/tituscapilnean/), Head of Marketing
October 27, 2026
Last updated October 27, 2026

**This is not legal advice.**
It is a general guide for store owners, drawn from the public sources it cites, and rules change and vary by state. Before you change how you price, tax, or bill, talk to a certified professional: an attorney who knows your state.

## Does a small store need a time clock at all?

Federal law does not require a time clock, but it does require accurate records of hours worked for every nonexempt employee, so your store needs some reliable way to capture when people start and stop. For most independent stores the practical answer is a time clock app on a phone or a shared tablet at the counter that feeds your payroll, because it creates those records automatically instead of adding another pile of paper to the back office.

The rest of this guide covers what the records have to include, how long to keep them, which of the five common setups fits a store your size, and the handful of policies worth writing down before you roll anything out.

## What federal law asks you to keep

The Fair Labor Standards Act sets the baseline for US stores, and it applies to your nonexempt employees, which in a supply store means most of the hourly folks: counter staff, the yard crew, whoever runs the tint area or mixing area, the part-timer who stocks shelves after school. For each of them you need records that include hours worked each day and hours worked each workweek, along with pay rates and earnings.

Here is the part that surprises owners who have been putting this off: the Department of Labor's [Fact Sheet #21](https://www.dol.gov/agencies/whd/fact-sheets/21-flsa-recordkeeping) says "The Act requires no particular form for the records" and "Employers may use any timekeeping method they choose." A punch clock, a paper log, a spreadsheet, a tablet app, all acceptable. The standard is that "any timekeeping plan is acceptable as long as it is complete and accurate." Complete and accurate is doing all the work in that sentence, and it is where paper systems tend to fall apart, because a timesheet filled in from memory on Friday afternoon is neither.

Retention matters too, and the two numbers are easy to mix up:

| Record | Keep it for |
| --- | --- |
| Payroll records (wages, hours by week, earnings) | At least 3 years |
| Records wage computations are based on, like time cards and daily hour logs | At least 2 years |

States and provinces layer their own rules on top of this. Meal break documentation, overtime triggers, and record retention all vary, and Canadian stores follow their provincial employment standards rather than the FLSA. The federal floor is a starting point, not the whole answer, so confirm the details for where you operate.

## Rounding, early punches, and other gray areas

The regulation behind all of this is [29 CFR 785.48](https://www.law.cornell.edu/cfr/text/29/785.48), and it states plainly that "Time clocks are not required." It also answers the two questions every owner asks once a clock is in place.

First, early and late punches. If an employee comes in early for their own reasons, grabs coffee, and does no work until the shift starts, that early punch may be disregarded. Same for the person who lingers after their shift chatting with the yard crew. The key phrase is "do no work." The moment they help a customer or start facing shelves, the clock is running and you owe for it.

Second, rounding. Rounding start and stop times to the nearest 5 minutes, or to the nearest tenth or quarter of an hour, is accepted for enforcement purposes, with one condition: over time it cannot result in failing to pay employees for all the time they worked. Rounding has to be a wash, not a discount.

A quick example with quarter-hour rounding. Maria punches in at 7:53 and the system records 8:00, then punches out at 5:08 and it records 5:15, so she loses seven minutes in the morning and gains seven at night, and across a pay period the ups and downs even out. That is fine. A setup that rounds every punch in the store's favor, late arrivals rounded up and early departures rounded down every single time, is not rounding. That is shorting paychecks with extra steps.

## The five ways small stores track time

Every option below can satisfy the law. The differences are cost, hassle, and how much you trust the numbers at the end of the pay period.

| Method | How it works | Where it falls short |
| --- | --- | --- |
| Paper cards and a punch clock | Employees punch a card, you tally by hand | Manual math every pay period, cards get lost, handwriting disputes |
| Wall-mounted clock with PIN, badge, or fingerprint | Dedicated hardware near the counter or break room | Hardware cost up front, still needs a way to export hours |
| Time clock app on a shared tablet | Staff punch in on a tablet already at the counter | Shared PINs make buddy punching easy unless you add photo capture |
| App on employees' own phones | Geofencing confirms they are at the store when they punch | Depends on connectivity and personal phones, some staff push back |
| Time tracking built into a payroll service | Hours flow straight into the same system that cuts checks | Ties your timekeeping to that provider, and switching means switching both |

A few trade-offs deserve a closer look. Buddy punching is the classic one: with a shared tablet and a PIN, you may discover your most punctual employee is whoever arrives first that morning. Photo capture at punch-in, or moving punches to personal phones, shrinks the problem without turning you into a detective. Connectivity matters more than vendors admit, because plenty of stores are metal buildings with a yard out back and Wi-Fi that gives up somewhere around the pallet racking, so ask whether the app queues punches offline and syncs later. And cost is often per employee per month, which is worth pricing out against your seasonal headcount rather than your January headcount.

If you go the payroll-service route, keep in mind that most supply-store systems hand payroll off to a dedicated provider rather than running it themselves, the same pattern covered in our guide to [ERP for hardware stores](/resources/guides/erp-for-hardware-stores/index.md). Bundling time tracking with payroll saves a step, but make sure you can still get your records out if you ever change providers.

## What to look for before you buy

Once you have the field narrowed to a couple of options, the checklist below is what separates a tool your staff will use every shift from one that becomes another chore by March.

Punching in should happen on a device that is already where the work is, which for most stores means the counter tablet or a phone, not a trip to the back office. Breaks need to be tracked, since some states and provinces have their own meal and rest break rules. Manager edits need an audit trail, meaning the system shows who changed a punch, what it was, and when, because corrections are normal and legitimate but invisible corrections are how disputes start.

Overtime alerts pay for themselves during the spring rush, when garden centers and feed stores add seasonal help and a part-timer drifting past 40 hours can sneak up on you in the busiest week of the year. Scheduling built into the same tool is a nice bonus, and once your hours data is clean you can start looking at sales per labor hour, one of the metrics we walk through in [retail KPIs for supply stores](/resources/guides/retail-kpis-for-supply-stores/index.md), to see whether your Saturday staffing matches your Saturday traffic.

On the back end, the app should export hours or sync directly to your payroll provider or QuickBooks, because re-keying timesheets is the exact chore you are trying to eliminate. If you are weighing your accounting setup at the same time, our comparison of [QuickBooks Online vs Desktop for retailers](/resources/guides/quickbooks-online-vs-desktop-for-retailers/index.md) covers how each handles that kind of connection. Finally, check that the tool stores records long enough to match the two and three year retention rules without you exporting spreadsheets into a filing cabinet, and that it handles seasonal staff coming and going without charging you for a deactivated employee all winter.

## Policies to write down before you roll it out

The tool is the easy half. The other half is a short written policy, a page at most, that keeps you consistent and keeps your records defensible.

Write down your rounding rule and your early-punch rule, and apply them the same way to everyone. Require each employee to review and approve their own timesheet every pay period before payroll runs, because the person who was there will catch a missed punch faster than you will, and their sign-off is worth a lot if a question ever comes up later. Never adjust hours downward without the employee knowing about it; if a punch looks wrong, ask, correct it together, and let the audit trail show the change.

Last, pay for required tasks. If closing duties include counting the drawer, that time is work, and it is compensable. A contractor walking in at 5:58 for a $12.40 box of screws means the checkout, the receipt, and the drawer count all start ten minutes late, and your closer is on the clock for every one of them. Our guide to the [end-of-day cash drawer closeout](/resources/guides/end-of-day-cash-drawer-closeout/index.md) covers that routine itself; the point here is that "we close at six" and "you stop being paid at six" are not the same sentence.

## Where Rundoo fits

Rundoo is the POS and back office for independent supply stores, and it does not include payroll or a time clock. Stores on Rundoo keep QuickBooks or their payroll provider for payroll, exactly as they did before, and the two systems sit side by side: hours live in your time clock app, wages live in payroll, and sales live in the POS. Whatever time clock you choose, a clean export to your payroll provider is the feature that makes the whole setup hold together.

## The bottom line

The law asks for complete and accurate records of hours worked, kept for two to three years depending on the record, and it does not care what tool produces them. Pick the method your staff will use correctly on every shift, get your rounding and early-punch rules in writing, have employees sign off on their own hours, and pay for the work that happens around the edges of the day, like counting the drawer. Do those four things and the time clock question mostly answers itself.

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## Frequently asked questions

Is a time clock required by law for a small business?

No. Federal rules state that time clocks are not required, and the Department of Labor says employers may use any timekeeping method they choose, as long as it is complete and accurate. What is required is a record of the hours each nonexempt employee works each day and each week, and some states and provinces add their own rules.

How long do I need to keep time cards?

Under the FLSA, records that wage calculations are based on, such as time cards, should be kept for two years, and payroll records for at least three years. State and provincial rules can be longer, so check where you operate.

Can I round employee clock-in times?

Federal rules accept rounding start and stop times to the nearest 5 minutes or the nearest tenth or quarter of an hour, provided that over time it does not result in employees being paid for less than the time they worked. Rounding that always favors the employer does not meet that test.

What should I look for in an employee time clock app?

Easy punching on a device already at the counter, break tracking, manager edits with an audit trail, overtime alerts, a way to limit buddy punching such as photo capture, offline punching if your Wi-Fi is weak, and a clean export or sync to your payroll provider, with records kept long enough to meet the two and three year federal retention rules.

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