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The 7-minute rule and time clock rounding rules

A lot of time clocks don't pay the exact minute you punch. They nudge each punch to the nearest 5, 6 or 15 minutes, and the 15-minute version is what people call the 7-minute rule.

Quick answer: Rounding moves each punch to the nearest 5, 6 or 15 minutes. With the 7-minute rule, a punch 1 to 7 minutes past a quarter hour drops back, and one 8 to 14 minutes past moves up to the next quarter. Federal rules allow it as long as, over weeks and months, workers still get paid for all the time they actually work.

What the 7-minute rule means

Split each hour into four marks, at :00, :15, :30 and :45. A punch up to 7 minutes after a mark is paid from that mark; from 8 minutes on, it jumps to the next one. That's why 8:07 becomes 8:00 while a punch only a minute later, at 8:08, becomes 8:15.

Your employer's own policy decides how your clock actually rounds, so treat the figures here as estimates.

Other common intervals

On a 5-minute grid, 8:02 rounds to 8:00 and 8:03 to 8:05. The 6-minute grid lines up with tenths of an hour, which is handy for payroll: 8:02 goes to 8:00 and 8:03 to 8:06, since 3 minutes sits exactly halfway and gets rounded up.

Some systems always round up and others always round down. That's a policy someone chose, not something the arithmetic requires.

Neutral rounding

Neutral rounding applies one rule to every punch, in both directions. Clock in at 8:53 and you're paid from 9:00; clock in at 9:06 and you're also paid from 9:00. At the other end, 5:07 drops to 5:00 and 5:08 climbs to 5:15. Across a few months of shifts, the minutes gained and lost should come out close to even.

It stops being neutral when rounding only ever runs one way, for instance every clock-in pushed up and every clock-out pushed down. The federal test looks at the pattern across many pay periods. One short Tuesday proves nothing; losing the same 10 minutes every shift does.

What the federal rule says

The time clock rule sits at 29 CFR 785.48. Part (b) calls rounding to the nearest 5 minutes, tenth of an hour or quarter hour a practice of long standing, and the Department of Labor accepts it so long as employees aren't left underpaid over a period of time.

Part (a) covers the minutes around a shift. If someone clocks in early or hangs around after clocking out, by choice, and does no work, that time doesn't have to be paid. Answering emails or setting up a till while waiting is work, and it counts.

State rules and California

States are free to be stricter than the federal rule, and California is the best-known case. In Donohue v. AMN Services (2021), the California Supreme Court held that employers can't round time punches for meal periods. It also said that time records showing a missed, short or late meal break raise a presumption of a violation, which the employer then has to rebut.

So California employers need to be careful with rounding of any kind. Other states have their own wage laws too, and your state labor department is the place to check before relying on a rounding policy.

Check your own punches

The time clock rounding calculator puts nearest, always-up and always-down rounding side by side. It does the arithmetic and nothing more, so it can't say whether a policy is lawful. Copy the paid hours onto a time card, and use hours to decimal if payroll wants tenths or hundredths.

Also: how to calculate work hours.