Setting Up Time Tracking So Job Costing Finally Makes Sense.

Setting Up Time Tracking So Job Costing Finally Makes Sense

This playbook walks you through setting up time tracking so your job costing reports tell the truth instead of just showing “labor total.”

The goal is not to create 50 codes nobody uses. The goal is to get enough detail to see where you make and lose money, without confusing your foremen or your office.

Who This Playbook Is For

This is built for commercial contractors who:

  • Already track time in an app, but only see totals by person or job
  • Want to understand which phases, scopes, or crews are eating margin
  • Have a job costing or accounting system, but the labor data feeding it is vague
  • Are ready to tighten up cost codes and time tracking without overcomplicating it

If you’re looking at job reports and still guessing where the labor went, this playbook is for you.

Step 1: Decide What You Actually Want to See

Before you touch any settings, decide what questions you want job costing to answer.

  • Which phases or scopes do you care about? (tear-off, install, punch, service, etc.)
  • Do you want to see hours by crew, by role, or just by job?
  • Do you need to see hours by roof section / area / phase or just job-wide?

Write down the 3–5 questions you want to answer every time you review a job. Your cost code structure should exist to answer those, nothing more.

Step 2: Build a Simple Cost Code List

Now create a cost code list that matches how you actually build work, not how a software vendor thinks you should.

  • Start with the main phases of work you care about (for example: tear-off, deck repair, install, flashing, punch/service).
  • Add a few role-based codes if needed (for example: foreman supervision, crane time, safety setup).
  • Keep it short—aim for 5–15 cost codes to start, not 40.

Ask yourself: “Can a foreman choose the right code in under 5 seconds?” If the answer is no, simplify or merge codes.

Step 3: Map Cost Codes Across Systems

Your time tracking system, payroll system, and accounting/job costing system should be speaking the same language.

  • Take your new cost code list and map each one to:
    • The codes or items in your accounting system
    • Any existing job costing categories you already use
  • Update your time tracking app so crews see the same names you use in accounting.
  • If your tools support it, use the same code numbers across systems, not just similar names.

The goal is to avoid “translation” work where the office has to guess which time entries map to which accounts.

Step 4: Update Jobs and Templates

Once your codes are clear, update your jobs and templates.

  • For active jobs, attach the new cost codes so foremen can use them immediately.
  • For future jobs, update your job templates so every new job starts with the right structure.
  • If your system supports it, hide old, unused codes so they don’t clutter the list.

Don’t leave it up to each foreman to decide which codes to use. Give them a consistent menu.

Step 5: Train Foremen on “How to Code Time”

Your system is only as good as the people entering time in the field.

  • Hold a short training session focused on:
    • Picking the right job
    • Selecting the correct cost code
    • What to do if they aren’t sure (who to ask, how to note it)
  • Give them a one-page cheat sheet showing:
    • Each cost code
    • Plain English explanation
    • Real examples of when to use it

Reinforce that the goal is not more admin—it’s better job numbers that protect crews and the company.

Step 6: Review Time Daily, Not Just at Payroll

If you only catch coding problems at payroll, it’s too late and too expensive to fix habits.

  • Have someone in the office or ops review time daily for:
    • Missing cost codes
    • Codes that don’t match the work done that day
    • Obvious mistakes (all hours coded to one phase, wrong job, etc.)
  • Fix errors and send quick feedback to foremen the same day.
  • Keep a short list of “most common mistakes” and address them in toolbox talks.

Daily corrections build habits. Waiting two weeks just builds frustration.

Step 7: Connect Time Data to Job Reviews

Clean time data only matters if you use it.

  • Set a regular cadence for job reviews (for example: weekly for big jobs, post-job for smaller ones).
  • In each review, look at:
    • Hours by phase vs what you expected
    • Which phases ran heavy or light on labor
    • Patterns across jobs (same phase over budget every time)
  • Use those patterns to adjust bids, staffing, and planning for future jobs.

Now your cost codes and time tracking are directly feeding better decisions, not just nicer reports.

Common Pitfalls to Avoid

  • Too many cost codes that nobody remembers or uses correctly.
  • Different names in each system (time app, payroll, accounting), which forces the office to translate.
  • No daily review, so bad habits go unchecked until payroll.
  • Changing codes constantly, which confuses foremen and breaks reports.

Stability plus simplicity beats complexity every time.

How to Measure Success

After 30–60 days, you should see:

  • Cleaner hours by job and phase in your time tracking reports
  • Job costing reports that clearly show where labor went
  • Fewer “miscellaneous” or “other” buckets in your accounting
  • Better conversations in job reviews—less guessing, more specifics

If those are happening, your time tracking is finally working for job costing, not against it.

Bottom Line

Good job costing starts with good time tracking. When your cost codes are simple, consistent, and mapped across your systems, your labor numbers start telling a clear story.

Set up the right codes, map them properly, train foremen, and review daily. When you do, your job reports stop being noise and start becoming one of your best tools for protecting margin.