Time Tracking for Nonprofits: Grants, Staff and Volunteers

A nonprofit with a federal grant does not get to decide its own timekeeping standard. The Uniform Guidance, at 2 CFR 200.430(g) as revised in 2024, says salary charged to a federal award must rest on records that accurately reflect the work performed. Those records must be backed by internal controls, reasonably reflect the employee's total compensated activity without exceeding 100% of it, cover federally funded and all other activities together, and support the split when one person works on several awards or on both grant and non-grant work. Budget estimates set before the work is done "alone do not qualify," though they can be used for interim charges if they are reviewed after the fact and corrected. For nonexempt employees, records must also show the total hours worked each day, as the Fair Labor Standards Act already requires.

The regulation does not prescribe a product or a workflow. Our recommended way to produce records that meet it is a timekeeping setup: each person records time against each grant and against everything else they do, and a supervisor approves it before it reaches payroll and the grant ledger.

For whom: a nonprofit of 5 to 100 staff with one or more federal awards, or a foundation grant that asks for the same detail. Not for: an organization whose staff are all funded from one unrestricted budget; a first time clock is enough there.

What a grant-ready setup needs, and where each tool has it

Our pick

Clockify Standard. It is the least expensive plan here that combines the three controls we recommend for grant-funded time: time split by grant, a supervisor's approval, and timesheets that cannot be quietly edited after approval. For a 20-person organization that is about $110 a month on annual billing.

• Choose Toggl Track Premium if program staff already use Toggl and its reporting; approvals arrive only on Premium, so budget for that tier from the start.
• Choose Harvest Enterprise if the organization also invoices fee-for-service work from tracked time; Harvest invoices on every plan, but approval and its activity log sit only on Enterprise.

Volunteers are a separate list

Keep volunteer hours apart from staff hours, ideally in a separate workspace or a clearly named project. The Department of Labor's Fact Sheet 14A says paid employees of a nonprofit cannot volunteer to provide the same type of services they are employed to do, and volunteers must serve without expecting pay. Mixing the two in one timesheet makes that line hard to show.

Where the tracker stops

Whatever time or cost reports a tracker can produce, treat your fund-accounting or grants system as the authoritative ledger for salary charged to each award and for the grant's financial report. The tracker's job is to be the approved, after-the-fact record that ledger relies on. Export approved time each pay period, and keep exports for the retention period your award sets. For the federal recordkeeping basics behind daily hours, see our employee timesheet template.