State and federal wage and hour laws work in tandem to ensure that employers are paying their employees for all hours worked. A very straightforward concept that is fraught with traps for the unwary. The latest pitfall? Artificial Intelligence (AI) powered time tracking.  

Increasingly, AI is being used to automate timekeeping duties such as tracking when workers sign in and out of work and to make independent determinations as to when an employee is “actively” working or “idle.” Herein lies the pitfall.  

As anyone who utilizes the Microsoft Teams platform knows, a user will be automatically marked “away” after five minutes of inactivity. This happens when the computer is idle, locked or in sleep mode, or if the Teams mobile app is running in the background.  Like Teams, AI powered timekeeping solutions are unable to accurately determine when work is being performed offline or away from the computer. This false impression of idleness or lack of work could lead the AI timekeeper to make an independent decision that no work is being performed resulting in a failure to pay an employee for all hours worked.  

Secondary risks include an automatic coding of all non-productive time as non-compensable. For example, under federal law, breaks lasting 20 minutes or less are generally deemed to be for the benefit of the employer and therefore, compensable. Automatically deducting such time would result in a violation of the employer’s duty to pay employees for all compensable time.  

What Does it Mean? 

Before implementing any AI powered timekeeping technology, employers should audit the software and its reporting systems to assess the technology’s ability to track all hours worked and report untracked time. The ability to see how the technology tracks both will allow the employer to assess the accuracy of the program and determine whether compliance will be placed at risk.