Manual time tracking & DACH labor laws: a risky combination

Let’s state the obvious right off the bat –  the DACH region has some of the strictest and meticulously enforced labor regulations in the world. 

And they’re particularly strict when it comes to time recording and documentation. 

So, if you’re part of this region, you can’t really afford incomplete employee timesheets or documentation gaps. 

But if you’re still on the fence about whether or not to switch to automated time trackers, I’ll tell you all about these, and the risks of manual time tracking.

What is manual time tracking?

Manual tracking is the practice of recording and calculating work hours through direct human input, often using spreadsheets, emails, and paper forms. In essence, it’s a time-consuming method that invites human error and compliance issues.

The DACH labor laws: zero tolerance for mistakes

In the DACH region, every hour worked, every break taken, and every minute of overtime must be properly documented, stored, and available for inspection. So, manual time tracking, which generally invites human error and compliance issues, isn’t the right choice for this region. 

Also, according to the Global Scape study, the cost of being out of compliance is 2.71 times higher than the investment in being and staying compliant.

Let’s see exactly what labor laws look like in the DACH region:

Germany

Since 2022, based on a Federal Labor Court (BAG) ruling, German employers are legally required to fully record the working hours of all employees, not just overtime. This means all start, end, and break times must be documented for each working day. 

Other important rules for German employers are:

• Documentation of all working hours, regardless of how many work hours per year or day.
• that exceed 8 hours per day.
• A precise recording of break periods (minimum 30 minutes for 6-9 hour shifts).
• Storage of time records for at least 2 years.
• Immediate availability of records for time audits of labor inspectors. 

Austria

The Austrian labor laws require the following: 

• Documentation of all hours worked, including start and end times. 
• Recording of all break periods, regardless of the break period.
• Retention of records for up to 7 years.
• All companies (with very limited exceptions) must keep digital records for their employees.
• Additional documentation for night shifts, weekend work, and public holidays. These are also subject to different compensations. Here is how these work: 

Switzerland

Swiss labor regulations come with a different layer of complexity, particularly due to Canton-specific regulations. Here is what Swiss labor laws require:

• Federal requirements for detailed time recording under the Employment Act
• Canton-specific variations in implementation and enforcement. Though the core rules are federal. 
• Specific documentation for different industries and categories of workers. For example, night work, Sunday work, and public holiday work require additional documentation of start and end times, and there are special regimes for managers, field staff, and employees with high autonomy
• Regular time record audits are usually at the cantonal level. 

Risks and costs of your business with manual tracking

Continuing to rely on manual time tracking in the DACH region is risky for your business, as it’s not a safety net. Here’s what you’re risking:

Financial penalties that escalate quickly

Non-compliance with labor laws in the DACH region doesn’t come cheap.

Germany

Fines for labor law violations start at a few hundred euros for minor offenses (e.g., €500 for encouraging violations) and can rise significantly for serious or repeated infractions. 

In severe cases, fines can exceed €30,000, and additional penalties can include criminal charges or business restrictions. Source

Austria

Administrative penalties for labor law violations range from low hundreds of euros for minor documentation failures (e.g., €100–€436, rising to €2,000 for repeated offenses or multiple employees). For serious breaches (such as wage dumping or illegal employment), fines can range from €500 up to €50,000 per case. Source

As well, in Austria, directors can be personally liable, and companies may face business bans or license revocation for egregious violations.

Switzerland

Swiss labor law fines range from CHF 500 for minor infractions up to CHF 30,000 or more for serious or repeated violations. Severe or systematic breaches can also lead to criminal fines up to CHF 1,000,000 and bans from operating in Switzerland.

Legal battles you might not win

When documentation is incomplete or inaccurate, you’re at a significant disadvantage in employee disputes. 

Without proper records, courts typically side with employees in cases involving overtime claims, break violations, or working time disputes. This means paying not just what’s owed, but also legal fees and potential damages.

Here are some of the additional legal vulnerabilities that manual time tracking creates for your business:

• Employee lawsuits for unpaid overtime (increasingly common in the DACH region)

• Class action potential when systematic errors affect multiple employees
• Director liability in cases of repeated or willful non-compliance 
• Potential debarment from public contracts after serious violations

Reputation damage that’s hard to repair

Beyond direct financial penalties, there’s the reputational damage to consider:

• Labor violations become public record in most DACH jurisdictions:
  Serious labor violations and regulatory penalties can become public, especially when authorities issue press releases or publish sanction lists. However, not all violations are automatically public record in every case.
• Companies with violations face enhanced scrutiny in future inspections.
• Business partners may require compliance certifications in contracts. 

Manual time tracking creates a heavy administrative burden and wastes HR resources that could be better used elsewhere. 

The safe bet in the DACH region: Automation

The solution to the risks you’re exposing your business to isn’t hiring more HR staff or creating more spreadsheets – but implementing a proper automated time tracking system.

Here’s what an automated time tracker brings to you as an employer: 

Real-time compliance monitoring

Automated systems like EARLY are built with DACH-specific labor laws in mind. EARLY provides continuous compliance monitoring that’s impossible with manual systems:

• Automatic notification of potential working time violations
• Alerts for approaching time budgets
• Real-time tracking of rest periods and breaks
• Country-specific rule customization for each DACH jurisdiction

Audit-ready documentation

When labor authorities come knocking (and in the DACH region, they will), an automatic time tracker ensures you’re prepared with: 

• Centralized electronic reports for regulatory inquiries, generated by a one-click time reporting system
• Instant and tamper-proof storage with your historical archives that meets legal requirements

Overtime, leaves and work schedule management

• Admins can set custom work hours and leave quotas for each employee, accommodating all types of contracts
• Automatic capture and calculation of extra hours worked and overtime based on configured work schedules and requested leave
• Accurate overview of worked, overtime, and deficit hours in one dashboard. 

Advanced reporting & analytics

• Automated, detailed reports on project profitability, team utilization, and billable vs. non-billable hours
• Productivity analysis by time of day, week, or project
• Data-driven insights to optimize resource allocation and project planning

Don’t let your business become another statistic…

in the growing list of companies facing penalties for non-compliance. Schedule a demo today to see how EARLY addresses the specific compliance challenges of your industry within the DACH regulatory framework.

Book a demo

If you’re an employee, here’s what this timesheet app brings to you:  

Ease of use

• Multiple time tracking options: You can use from a one-click timer, to automatic background tracking, or manual time entry
• Your work is captured automatically: Automatic detection of apps, tools, and websites used, which are then added to your timesheet.

Transparency & empowerment

• Instant access to personal timesheets and activity records, with the ability to verify and manage your time entries. 
• Adaptable to remote, hybrid, and in-office work environments, so you can track work on tasks wherever you are. 

Take action: don’t wait for a costly mistake

Labor regulations in the DACH region continue to evolve, with enforcement becoming increasingly stringent. The European Court of Justice’s recent rulings have only reinforced the obligation for precise time recording, and local authorities are responding with more frequent and thorough inspections.

The trend toward stricter enforcement is clear, and businesses that fail to adapt will face escalating consequences. So, the question isn’t whether you can afford to implement automated time tracking—it’s whether you can afford not to.