Subcontractors estimate that 2-5% of their T&M work tickets go missing. That’s thousands of dollars in legitimate revenue, lost.
The average T&M ticket takes 24-30 days to process using paper methods. By the time the change order request reaches the GC, details are fuzzy, documentation is incomplete, and disputes start.
Effective T&M tracking eliminates revenue leakage. Digital systems can reduce that 30-day processing time to 3.5 days while virtually eliminating lost tickets and disputed charges.
Here’s how to stop leaving money on the table.
The True Cost of Poor T&M Tracking
T&M work represents significant revenue for contractors—but only if it gets documented, approved, and billed correctly. Here’s where the money disappears:
Processing Delays
- 24 days average between signing a T&M ticket in the field and submitting a change order request
- 30 days average for specialty contractors to price T&M tickets
- Change order requests submitted late are far more likely to be rejected
Lost Documentation
- 2-5% of T&M tickets go missing with paper-based systems
- 80% of timesheets require error corrections
- 70% of construction disputes stem from inadequate project documentation
Time Theft
- 1.5-7% of gross payroll lost annually to time theft
- 75% of U.S. businesses lose money to buddy punching
- $373 million lost to buddy punching nationwide each year
The Cash Flow Impact
Subcontractors end up self-financing extra work for weeks or months. The longer T&M sits unsubmitted, the more strain it puts on cash flow—and the more likely it is to be disputed or rejected entirely.
Why Paper-Based T&M Tracking Fails
Paper T&M tickets seem simple. They’re not. Here’s what goes wrong:
- Bad handwriting: Illegible entries lead to misinterpretation and disputes
- Lost documents: 2-5% of paper tickets never make it from field to office
- Physical damage: Coffee stains, weather damage, torn pages
- Transportation delays: Tickets sit in trucks for days before reaching the office
- Duplicate data entry: Someone has to re-enter every ticket into accounting systems
- No backup: When paper is lost, the record is gone
- No visibility: Impossible to track which tickets are pending approval
The result: delays, disputes, and lost revenue that paper systems can’t prevent.
Best Practices for Effective T&M Tracking
1. Document Everything in Real-Time
T&M tracking starts in the field—not at the end of the week or month. Capture labor hours, materials, and equipment usage as work happens.
- Log clock-in/clock-out times daily
- Record materials used with quantities and costs
- Track equipment hours with rental rates
- Note scope of work performed in detail
2. Use Photo Documentation
Site photos provide the strongest defense against disputes. According to FMI Corporation, 70% of construction disputes stem from inadequate documentation.
- Take time-stamped photos before, during, and after work
- Include photos with every T&M ticket
- Capture site conditions that required the extra work
- Document materials delivered and installed
3. Submit Tickets Daily—Not Monthly
The longer the lag between work performed and change order submitted, the more likely disputes will arise. CORs submitted late are far more likely to be rejected.
- Establish a daily submission cadence
- Get GC signatures on-site when possible
- Submit change order requests within 7-14 days of work completion
- Don’t wait until the end of the month to process tickets
4. Get Digital Signatures Immediately
Chasing signatures weeks after work is completed invites disputes. GCs may not remember authorizing the work. Get approval documented immediately.
- Capture digital signatures on mobile devices
- Include timestamp and location verification
- Create a clear trail showing when work was authorized
- Don’t start work without documented pre-authorization for significant changes
5. Integrate GPS Verification
GPS data proves workers were on-site when work was logged. This eliminates disputes about whether work actually occurred.
- Use geofencing to verify work location
- Timestamp all entries with location data
- Create audit trail showing who was where, when
The Digital T&M Tracking Advantage
Digital T&M tracking transforms the economics of extra work. Here’s what the numbers show:
Processing Time
- Paper: 24-30 days from field signature to change order submission
- Digital: 3.5 days average processing time
- Result: 75% faster change order approvals
Lost Revenue
- Paper: 2-5% of tickets go missing
- Digital: Virtual elimination of lost tickets
- Result: Full capture of billable work
Disputes
- Paper: Limited documentation for defense
- Digital: Time-stamped photos, GPS data, digital signatures
- Result: Defensible records that hold up to scrutiny
Administrative Time
- Paper: Manual data entry for every ticket
- Digital: Automatic sync to accounting systems
- Result: Hours saved weekly on data entry
What to Look for in T&M Tracking Software
Not all digital tools are equal. Essential features for effective T&M tracking:
Field Capabilities
- Mobile app: Field crews capture data on phones and tablets
- Offline functionality: Works without cell service, syncs when connected
- Photo documentation: Time-stamped images attached to tickets
- Digital signatures: Capture approvals on-site
- GPS verification: Location proof for all entries
Workflow Features
- Real-time approval tracking: See which tickets are pending, approved, or rejected
- Automated notifications: Alert when approvals are needed or deadlines approach
- T&M vs. fixed-price toggle: Easily separate T&M work on the same project
- Customizable rate sheets: Pre-load labor and equipment rates by project
- Automated markup calculations: Apply contractual markups automatically
Integration Requirements
- Accounting software sync: Connect with QuickBooks, Sage, or your accounting system
- ERP integration: Flow data to construction ERP platforms
- Payroll connectivity: Send verified time data directly to payroll
- Project management tools: Integrate with broader PM platforms
Real Results: Case Studies
Suffolk Construction
After implementing digital T&M tracking, Suffolk saw project managers save 20+ hours per week previously spent on manual T&M processing. Processing time dropped from 38 days, and teams eliminated the need to decipher handwriting and chase down missing tickets. Subcontractors saw immediate benefits in faster submissions and approvals.
Vye Construction
Digital transformation delivered $2.14 million in verified ROI, with change orders built in 12 minutes versus 3.5 hours previously. The company saved 381 hours annually and achieved 42% profit margins on key projects.
Diamond Concrete
Digital reporting and documentation saved over $100,000 in litigation costs by providing defensible records when disputes arose.
Getting Started: Implementation Tips
1. Involve Field Crews Early
Include experienced crew leaders in software evaluation. Their insights about field usability often reveal issues that management misses during demos. If foremen won’t use it, it won’t work.
2. Start with a Pilot Project
Test digital T&M on one project before company-wide rollout. Work out the kinks, build confidence, and gather success stories that help with broader adoption.
3. Ensure Offline Capability
Construction sites often lack reliable connectivity. Make sure your chosen solution works offline and syncs when connection is restored.
4. Train on Approval Workflows
The tool is only as good as the process. Train everyone—field crews, PMs, office staff—on the approval workflow from T&M ticket to change order to invoice.
5. Measure Baseline Metrics
Track your current processing times, lost ticket rates, and dispute frequency before implementation. You’ll need this baseline to measure ROI.
Frequently Asked Questions
What is T&M tracking?
T&M tracking is the process of documenting labor hours, materials, and equipment used on time-and-materials construction work. Effective tracking captures this data in real-time, gets approvals documented, and flows information to billing and accounting systems.
How long does T&M ticket processing typically take?
With paper-based systems, the average T&M ticket takes 24-30 days to go from field signature to change order submission. Digital T&M tracking can reduce this to 3.5 days—a 75% improvement.
How much revenue do contractors lose from poor T&M tracking?
Subcontractors estimate that 2-5% of T&M tickets go missing with paper-based systems. Additionally, scope creep where work goes unbilled accounts for 3-5% of project revenue. Poor contract management overall can cost 9% of annual revenue.
What documentation should be included with T&M tickets?
Comprehensive T&M documentation includes: detailed description of work performed, labor hours by worker with clock-in/out times, materials used with quantities and costs, equipment hours with rental rates, time-stamped photos of work, GPS location verification, and digital signatures for approval.
Can T&M tracking software work offline?
Quality T&M tracking solutions include offline functionality that allows field crews to capture data without cell service. The data syncs automatically when connectivity is restored.
Key Takeaways
- Revenue leakage: 2-5% of T&M tickets go missing with paper systems—capture every ticket digitally
- Processing time: Digital tools reduce processing from 30 days to 3.5 days
- Documentation: 70% of disputes stem from poor documentation—photos and timestamps are your defense
- Daily submission: Don’t wait until month-end—submit T&M tickets daily to avoid rejections
- Digital signatures: Get approval on-site while work is fresh in everyone’s mind
- GPS verification: Location data proves workers were on-site when work was logged
- Integration: Connect T&M tracking to accounting for seamless billing
Every day your T&M process runs on paper is a day you’re leaving money on the table. The contractors capturing full T&M value are the ones using real-time digital tracking with proper documentation, fast approvals, and seamless billing workflows.
