Let’s talk about something that sounds minor—but can turn into a major wage-and-hour issue for employers: time rounding.
You’ve probably seen it in action. An employee clocks in at 8:56 a.m., but the system rounds it to 9:00 a.m. Or someone clocks out at 5:04 p.m., but it’s recorded as 5:00 p.m. Seems harmless, right? Maybe even a helpful administrative shortcut.
But under federal and state wage laws, these small adjustments can add up fast—and lead to serious legal exposure. Both the Fair Labor Standards Act (FLSA) and West Virginia’s wage laws have rules (and some gray areas) when it comes to rounding employee time.
So let’s unpack the legal framework around time rounding: what’s allowed, what’s risky, and how employers and employees can protect themselves.
What Is Time Rounding?
Time rounding is the practice of adjusting recorded clock-in and clock-out times to the nearest increment—typically 5, 6, 10, or 15 minutes. It’s been around since the days of punch clocks and was originally meant to simplify payroll calculations.
Under this system:
- An 8:57 a.m. punch might round back to 8:55 or 9:00.
- A 5:02 p.m. punch might round to 5:00 p.m.
It all seems reasonable—until you realize that those lost minutes can stack up over time and potentially push a non-exempt employee’s hours below 40 per week, cutting off overtime.
What the FLSA Says About Time Rounding
The U.S. Department of Labor (DOL) does allow time rounding, but with serious limitations. According to 29 C.F.R. § 785.48(b):
“It has been found that in some industries… there has been the practice for many years of recording the employees’ starting and stopping time to the nearest 5 minutes, or to the nearest one-tenth or quarter of an hour. This practice… is accepted, provided that it is used in such a manner that it will not result, over a period of time, in failure to compensate the employees properly for all the time they have actually worked.”
The key word there? “Evenhanded.” The rounding system must be neutral—it can’t always work in the employer’s favor. And over time, it must fairly compensate employees for the time they actually worked.
If the rounding consistently favors the house, the employer could be looking at back pay and damages under the FLSA.
The DOL’s Current Position
In recent years, the DOL has taken a harder look at rounding, especially with the rise of digital timekeeping systems that can track exact time to the minute or second. The DOL’s guidance, at least before the second Trump administration, emphasizes that when accurate records are available, rounding may no longer be necessary or appropriate. But the DOL in one opinion letter accepted limited rounding with this explanation: “It has been our policy to accept rounding to the nearest five minutes, one-tenth of an hour, one-quarter of an hour, or one-half hour as long as the rounding averages out so that the employees are compensated for all the time they actually work.”
Recent Court Decisions
Federal courts are also tightening the leash on rounding policies. In Camp v. Home Depot U.S.A., Inc., 84 Cal. App. 5th 638 (Cal. Ct. App. 2022), the court ruled that a company’s rounding practice was illegal where the employer could and did track employees’ exact hours—and where the rounding systematically underpaid employees.
While that case came out of California, its reasoning is spreading. Courts are more likely today to ask: If you can track exact time, why aren’t you?
Another example: Troester v. Starbucks Corp., 421 P.3d 1114 (Cal. 2018), where the California Supreme Court rejected the application of the federal “de minimis” rule to small unpaid periods at the beginning or end of shifts. Again, the takeaway is that even small time losses count if they’re regular and avoidable.
West Virginia Law on Rounding
West Virginia’s wage statutes don’t specifically address time rounding. But that doesn’t mean employers are off the hook.
Under the West Virginia Wage Payment and Collection Act, W. Va. Code § 21–5‑1 et seq., employers must pay employees all wages earned, including overtime where applicable. If rounding results in underpayment, especially of overtime, the employer may be violating both state and federal law.
Plus, West Virginia allows for liquidated damages of up to three times the unpaid wages (W. Va. Code § 21–5‑4(e)). That’s a powerful incentive for employees to sue—and a strong reason for employers to play it safe.
Common Pitfalls
Employers often fall into these traps:
- Rounding only in one direction (almost always in the employer’s favor).
- Failing to audit rounding practices for fairness.
- Using rounding with time-tracking software that already provides precise data.
- Applying rounding to meal breaks or rest periods (a big no-no under DOL guidance).
Even well-meaning HR departments can end up violating the law if they don’t regularly test their rounding rules against actual payroll records.
Best Practices for Employers
- Review your timekeeping system. If it tracks to the minute, consider dropping rounding altogether.
- Run regular audits. Check to see if rounding ends up consistently reducing employee pay.
- Use rounding both ways. Your policy should allow for both upward and downward rounding to avoid claims of favoritism.
- Train managers. They need to understand that asking someone to work “just a few minutes” off the clock could trigger legal liability.
And remember: With the rise of wage-and-hour class actions, it only takes one underpaid worker to kick off a lawsuit that drags everyone in.
What Employees Should Watch For
- Track your hours independently if you think your employer is rounding down too often.
- Keep an eye on whether your clock-in/clock-out times always get shortened.
- If you’re not being paid for pre-shift work (like setting up, logging in, or prepping equipment), talk to HR.
Final Thoughts
Time rounding might seem harmless, but it’s a risky practice in today’s legal landscape. With digital tools making precise timekeeping easier than ever, the courts and the DOL are losing patience with “neutral” rounding systems that wind up shortchanging workers.
For employers, it’s time to consider whether rounding is worth the risk. And for employees, if your paycheck consistently seems a little too light, it might be time to take a closer look at the clock.
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