How NOT to do time tracking: the first fines

The obligation to record working hours has been in force since May 2019. Yet many companies keep making the same mistakes: they keep no records at all, their records are incomplete, they allow someone other than the employee to modify time entries, or they simply use a tool that does not meet the legal requirements.

The Labour Inspectorate has been acting for years, and the figures speak for themselves: in the first months after the regulation came into force, more than 980 companies ended up with a sanctioning proceeding and over 5,300 files were opened for non-compliance. The average fine was around €1,057. And that was just the beginning.

What does the Labour Inspectorate check?

When the Labour Inspectorate visits a company to verify compliance with working time tracking rules, it reviews three specific elements:

The three points the Inspectorate checks

• The existence of a working time record: the company must be able to demonstrate that it keeps records systematically for all employees.
• The validity of the system used: the time-tracking method must be objective, reliable, and must not allow anyone other than the employee to modify the record without leaving a trace.
• The validity of the record itself: the content must be complete, consistent, and kept for the four years required by law.

If any of these three elements fails, the company faces a sanction. And they don't all have to fail at once: an incomplete record, a tool that allows entries to be modified without a trace, or simply missing data for one employee can be enough for the inspector to raise a formal notice.

Who is required to keep working time records?

Virtually every company with salaried employees. The law sets no exceptions based on size or sector. Only certain special employment relationships are excluded, such as senior executives, domestic workers, professional athletes, or performers in public shows, among others.

For everyone else — the vast majority of SMEs and self-employed with staff — daily working time recording has been a legal obligation for years. And with the new mandatory digital time-tracking decree on its way, that obligation will be reinforced even further.

Fines for non-compliance: minor, serious, and very serious

Penalties for failing to comply with working time tracking rules are classified into three levels according to severity:

Types of infringement and their fines

• Minor infractions (€70 – €750): when the company fails to inform employees about working conditions or does not give them access to their own time records.
• Serious infractions (€751 – €7,500): when there are unpaid overtime hours, irregularities in the time record, or a complete absence of records. This is the most common category in inspections.
• Very serious infractions (€7,501 – €225,018): when overtime has been worked by employees under 18, or when there is repeated or systematic non-payment of agreed remuneration.

The most common mistakes that lead to fines

After years of inspections, the pattern of non-compliance is clear. These are the most frequent failures the Labour Inspectorate finds:

Errors that lead to sanctioning proceedings

• Keeping no record at all: continuing to use verbal methods or simply not recording working hours.
• Using a spreadsheet or paper without meeting the minimum requirements: no start and end times, no four-year retention, or no guaranteed employee access.
• Allowing the company (rather than the employee) to fill in or modify time entries without leaving a trace of the change.
• Not having the record available when the Inspectorate requests it: even if it exists, failing to present it immediately can also lead to a fine.
• Incomplete records: employees who don't clock in for days or weeks without the company detecting or correcting it.
• Ignoring remote workers or those working at different locations: all are required to record their working hours, regardless of where they work.

20% of inspected companies have been fined for non-compliance with working time tracking rules. Small businesses are the most affected, both due to lack of implementation and due to attempts to fraudulently modify records.

What your company should do to avoid that risk

The good news is that complying with working time tracking regulations is not complicated with the right tool. Here are the essential steps:

Steps to stay compliant

• Implement a digital time-tracking system that records the start and end time of each working day, breaks, and overtime.
• Ensure the system is tamper-proof: any modification must be logged with user, date, and reason.
• Guarantee that each employee can consult their own record at any time.
• Keep records for at least four years in a format that can be immediately presented to the Inspectorate.
• Set up automatic alerts to detect when an employee has not clocked in, and act before incomplete records accumulate.
• Cover all employees: in-person, remote, part-time, and across all work locations.

Benefits of doing time tracking properly

Beyond avoiding fines, a well-implemented time tracking system has a direct positive impact on team management:

Real benefits for the company

• Transparency and trust: a clear record reduces misunderstandings and labour disputes about hours worked.
• Overtime control: deviations are detected before they become payroll problems or labour claims.
• Improved productivity: working hour data allows better distribution of work and shifts.
• Easier payroll processing: if the record integrates with payroll management, the monthly process is automated.
• Protection in labour disputes: if an employee makes a claim, the company can demonstrate exactly the hours worked and their compensation.

Horalia: automatic compliance, no complications

Horalia is a workforce management platform designed for SMEs and self-employed with staff, automatically covering all requirements of current regulations and those of the new digital time-tracking decree. With Horalia, the record is tamper-proof, traceable, accessible to each employee, and exportable for the Inspectorate in seconds.

What Horalia does for your company

• Multi-device time tracking: mobile, browser, or physical terminal, in-person or remote.
• Tamper-proof record with modification log: every change is traced.
• Automatic alerts when an employee has not clocked in.
• Integrated absence, holiday, and leave management.
• Visual and intuitive shift planning.
• Document management with biometric digital signature.
• Inspectorate reports generated in seconds.

Want to know how much a fine could amount to in your company based on your number of employees and the type of infraction? Use our working time tracking sanctions calculator and get an estimate in seconds.