December 30, 2025

You can, but we generally recommend not tracking unless you’ve got a legitimate business reason for doing so. Most exempt employees don’t expect to have to track their hours and will likely bristle at the idea. After all, not having to punch a clock is considered one of the major benefits of being exempt.

That said, there are valid business reasons for tracking exempt employee hours, including client billing, grant compliance, and accurate allotment and tracking of Family and Medical Leave Act leave.

If you choose to track the hours of exempt employees, make sure the information isn’t used to take deductions unless they’re allowed under both state and federal law. Impermissibly prorating an exempt employee’s salary based on hours worked could result in the loss of the exemption as well as wage and hour claims.

This Q&A does not constitute legal advice and does not address state or local law..