Time Clock Rounding Rules: 5, 6 and 15 Minutes

The federal rule

The Department of Labor's interpretation of hours worked is in 29 CFR part 785. Section 785.48 deals with time clocks and has two parts.

• Early and late punches (paragraph a). Employees who voluntarily come in early or stay late and do no work during that time need not be paid for it, so their early or late punches can be disregarded. The regulation also notes that minor differences between clock records and actual hours cannot ordinarily be avoided, but major ones should be discouraged.
• Rounding (paragraph b). Recording start and stop times to the nearest 5 minutes, or to the nearest tenth or quarter of an hour, is accepted for enforcement, provided it averages out so that employees are fully paid for the time they actually work over a period of time.

The key word is nearest. A punch moves to the closest step, sometimes up and sometimes down, so the minutes gained and lost should cancel out. Rounding always in one direction is not nearest rounding at all.

The three common steps

A smaller step means smaller swings on each punch. With 5-minute rounding a punch never moves more than 2 minutes; with quarter-hour rounding it can move 7.

Tenth-hour rounding has one practical upside: the result is already a clean decimal. Each 6 minutes is 0.1 hour, so a shift that rounds to 7 hours 42 minutes is 7.7 hours, and 7.7 hours at $20 is $154.00. Quarter-hour rounding gives quarters instead: 7.25, 7.5 or 7.75 hours. Five-minute rounding gives twelfths of an hour, which do not turn into short decimals (5 minutes is 0.0833 hour), so it is simpler to add up the minutes and convert only the weekly total.

The 7-minute rule, in arithmetic

Quarter-hour rounding splits each 15 minutes at the middle. A punch 1 to 7 minutes past a quarter rounds back to that quarter; 8 to 14 minutes past rounds forward to the next quarter. People call this the 7-minute rule. It is not a separate rule in the regulation, only what "nearest quarter hour" means in whole minutes.

Because a clock punch is a whole minute and 15 has no whole-minute middle, there is never a tie at quarter-hour rounding. With 6-minute rounding there is: 3 minutes past is exactly halfway. The table below rounds a halfway minute up, the same way the timesheet calculator does.

Clock times and their rounded values

A plus means the rounded time is later than the punch. For a start time that costs the employee minutes; for an end time it adds them. That is why the same rounding step can favor either side on any one punch, and why the regulation looks at the result over time.

A worked week: nearest vs one-sided

Here is one week of punches for a 9-to-5 job with an unpaid 30-minute lunch. The lunch is not rounded. The table compares the exact time, the time after rounding each punch to the nearest quarter hour, and a one-sided policy that always rounds the start up and the end down.

Nearest rounding left the week 1 minute under the exact total. Some days gained, some lost, and the week nearly cancels out, which is the pattern 785.48(b) describes. The one-sided policy paid 61 minutes less than the exact time in a single week. At $20 an hour that is $20.33 a week and $1,057.33 over 52 weeks, all of it time the employee was on the clock.

Use the hours calculator to check a single shift to the minute, or enter a whole week in the timesheet calculator with rounding set to None and again to 15 minutes to see the difference for your own punches.

Rounding and overtime

Federal overtime is owed at not less than one and one-half times the regular rate for hours over 40 in a workweek. Rounded time feeds straight into that total, so minutes lost to rounding near the end of a long week are overtime minutes. If a week of exact punches comes to 41 hours 20 minutes and one-sided rounding trims it to 40 hours 50 minutes, the employee loses 30 minutes paid at time and a half, not at the base rate. The overtime pay calculator shows what each overtime hour is worth at a given rate.

Stricter state rules

States can set rules that go further than federal law. One that is settled by a primary source is California. In Donohue v. AMN Services, decided February 25, 2021, the California Supreme Court held that employers cannot round time punches in the meal period context, because the meal period rules are meant to prevent even minor infringements. The court also said it has never decided whether the general rounding standard used by lower California courts is valid, so it left that question open. If you work in another state, check that state's labor department for its own rule before you rely on the federal one.

How to check your own rounding

• Write down your exact punches for a few weeks, or ask payroll for the raw clock records, not only the rounded ones.
• Add up both versions. Exact time and rounded time should land close together over weeks, with some weeks up and some down.
• Look at the direction. If every start rounds later and every end rounds earlier, the policy is not rounding to the nearest step.
• Check what you did before the punch. Time spent working before clocking in, or after clocking out, is work time even if the clock does not show it.
• Watch the meal period punches if you work in California, where rounding them is not allowed.

Related guides: meal and rest break laws by state covers which breaks count as paid time, and exempt vs non-exempt employees explains who is owed overtime in the first place.

Frequently asked questions

Sources

• eCFR, 29 CFR 785.48 Use of time clocks (early and late punches without work may be disregarded; rounding to the nearest 5 minutes, tenth or quarter hour accepted if it averages out)
• US Department of Labor, Wage and Hour Division: Overtime pay (time and one-half the regular rate for hours over 40 in a workweek)
• Supreme Court of California, Donohue v. AMN Services, LLC, S253677, February 25, 2021 (no rounding of meal period punches; validity of rounding in general not decided)

General information based on the sources above, not tax, legal or financial advice.

Written by Tobias. Updated November 2, 2026.