Editor’s note: Nic De Bonis is CEO and co-founder of workforce management software provider Workyard. Opinions are the author’s own.
I’ve had enough contractor conversations to notice when an industry has a blind spot. This is one of them.
Contractors run tight operations. They price jobs down to the hour, they know their material costs and they watch margin on every bid. What most of them never stop to think about is whether their time records could hold up in a deposition two years from now.
That’s the gap. Inaccurate time records aren’t just a payroll inconvenience. For most contractors they’re an invisible compliance liability, one that stays invisible right up until a former employee files a claim and the records can’t answer the question.
The wrong problem
In sales conversations with more than 180 mid-market construction contractors, nearly half came to us focused on payroll efficiency or workforce visibility. They talk about timesheets that arrived late, foremen clocking in the whole crew without verifying anyone, hours that didn’t match what the superintendent remembered. These are real problems, no question.
But only 4% named compliance or legal exposure as their reason for talking to us.
Of the contractors tracking time on paper or spreadsheets, 72% never raised a compliance concern once in the conversation. I don’t think they’re dismissive. It just hadn’t occurred to them that their records might not hold up if someone challenged them.
They were managing the risk they could see and completely missing the one they couldn’t.
Why this risk is different
Most compliance failures in construction require an actual error. Safety violations, misclassification and prevailing wage gaps all imply something went wrong. Fix the error, fix the problem.
Recordkeeping doesn't work that way.
A contractor can pay every worker accurately, at the right rate and on time, and still lose a wage claim because the records to prove it don't hold up.
Under the Fair Labor Standards Act, workers have two years to file (three if a violation is deemed willful). When a claim arrives, the employer has to reconstruct every relevant shift. That’s hard with just a paper sign-in sheet and just as hard with an Excel file with no change history. A foreman's recollection against a former worker's? That’s not evidence.
The math compounds. Workers can pursue back wages plus an equal amount in liquidated damages, meaning a $50,000 overtime dispute becomes $100,000 before attorney fees.
The Department of Labor’s Wage and Hour Division recovered more than $259 million in back wages for nearly 177,000 workers in fiscal year 2025. In construction specifically, one enforcement push produced more than 3,000 investigations in a single year and $36 million recovered for 21,000 workers. The violations most commonly found were overtime miscalculations, uncompensated travel time and undocumented breaks.
Those are records failures, not intent failures.
Most contractors don't realize one thing until they're in it: The legal system doesn't evaluate whether you paid correctly, it evaluates whether you can demonstrate it. Those are two different standards, but the industry is largely prepared for only one of them.
What contractors say after the fact
The conversations that stick with me aren't the ones about efficiency. They're the ones where a contractor is describing a situation they didn't see coming.
One contractor ended up in a lawsuit over a worker's claim that he never received a lunch break. There was nothing in the records to say otherwise.
Another, after learning about similar claims making the rounds in his trade, said he had no way to prove his crews had taken their breaks either.
A third described his standard daily process: Superintendents collected signatures at the start of the shift, but break periods and departures went undocumented. Nothing in writing confirmed what actually happened between clock-in and clock-out.
Each of these contractors was tracking time. None of them had records that held up when tested.
The reframe the industry needs
The contractors who come through wage claims intact share one trait: They treated time records as legal documents before anyone asked them to. They deliberately have timestamped entries, break confirmations workers sign off on themselves or a log of who changed what and when.
I understand why this reframe is hard.
Time tracking gets presented to contractors as a payroll tool, something that makes running payroll faster. That framing is accurate, but an attorney or a DOL investigator doesn't look at time records as a payroll artifact. They look at them as evidence.
The good news is that solving this does not require reinventing how you run a job. The best time tracking systems handle the legal record problem quietly in the background without adding much to a foreman’s daily routine.
The systems that solve this well share three features:
- Workers clock in and out with a sign-off that confirms breaks were taken.
- GPS provides a secondary accuracy layer that doesn't depend on anyone's memory.
- Every time card modification is logged automatically with a weekly approval before payroll runs.
Those three things together create a record that holds up. No dramatic change needed, only a documentation standard that finally matches what the legal system actually requires without placing a huge burden on your crew.
