diff --git a/backend/database/init-schema.sql b/backend/database/init-schema.sql
index 42f3637..4d650f9 100644
--- a/backend/database/init-schema.sql
+++ b/backend/database/init-schema.sql
@@ -1,135 +1,101 @@
 -- Work Allocation System Database Schema
--- This version is for Docker init (database already created by environment variables)
+-- MySQL 8.0
 
--- Departments table
+-- Create departments table
 CREATE TABLE IF NOT EXISTS departments (
-    id INT PRIMARY KEY AUTO_INCREMENT,
+    id INT AUTO_INCREMENT PRIMARY KEY,
     name VARCHAR(100) NOT NULL UNIQUE,
-    created_at TIMESTAMP DEFAULT CURRENT_TIMESTAMP,
-    updated_at TIMESTAMP DEFAULT CURRENT_TIMESTAMP ON UPDATE CURRENT_TIMESTAMP
+    created_at TIMESTAMP DEFAULT CURRENT_TIMESTAMP
 );
 
--- Sub-departments table (for Groundnut department)
+-- Create sub_departments table
 CREATE TABLE IF NOT EXISTS sub_departments (
-    id INT PRIMARY KEY AUTO_INCREMENT,
+    id INT AUTO_INCREMENT PRIMARY KEY,
     department_id INT NOT NULL,
-    name VARCHAR(200) NOT NULL,
-    primary_activity VARCHAR(200) NOT NULL,
+    name VARCHAR(100) NOT NULL,
+    primary_activity VARCHAR(255),
     created_at TIMESTAMP DEFAULT CURRENT_TIMESTAMP,
-    updated_at TIMESTAMP DEFAULT CURRENT_TIMESTAMP ON UPDATE CURRENT_TIMESTAMP,
-    FOREIGN KEY (department_id) REFERENCES departments(id) ON DELETE CASCADE
+    FOREIGN KEY (department_id) REFERENCES departments(id) ON DELETE CASCADE,
+    UNIQUE KEY unique_subdept (department_id, name)
 );
 
--- Users table (for all roles: SuperAdmin, Supervisor, Contractor, Employee)
+-- Create users table
 CREATE TABLE IF NOT EXISTS users (
-    id INT PRIMARY KEY AUTO_INCREMENT,
-    username VARCHAR(100) NOT NULL UNIQUE,
-    name VARCHAR(200) NOT NULL,
-    email VARCHAR(200) NOT NULL UNIQUE,
+    id INT AUTO_INCREMENT PRIMARY KEY,
+    username VARCHAR(50) NOT NULL UNIQUE,
+    name VARCHAR(100) NOT NULL,
+    email VARCHAR(100) NOT NULL UNIQUE,
     password VARCHAR(255) NOT NULL,
     role ENUM('SuperAdmin', 'Supervisor', 'Contractor', 'Employee') NOT NULL,
     department_id INT,
     contractor_id INT,
     is_active BOOLEAN DEFAULT TRUE,
     created_at TIMESTAMP DEFAULT CURRENT_TIMESTAMP,
-    updated_at TIMESTAMP DEFAULT CURRENT_TIMESTAMP ON UPDATE CURRENT_TIMESTAMP,
     FOREIGN KEY (department_id) REFERENCES departments(id) ON DELETE SET NULL,
     FOREIGN KEY (contractor_id) REFERENCES users(id) ON DELETE SET NULL
 );
 
--- Contractor rates table (rates per contractor + sub-department combination)
-CREATE TABLE IF NOT EXISTS contractor_rates (
-    id INT PRIMARY KEY AUTO_INCREMENT,
-    contractor_id INT NOT NULL,
-    sub_department_id INT,
-    activity VARCHAR(200),
-    rate DECIMAL(10, 2) NOT NULL,
-    effective_date DATE NOT NULL,
-    created_at TIMESTAMP DEFAULT CURRENT_TIMESTAMP,
-    updated_at TIMESTAMP DEFAULT CURRENT_TIMESTAMP ON UPDATE CURRENT_TIMESTAMP,
-    FOREIGN KEY (contractor_id) REFERENCES users(id) ON DELETE CASCADE,
-    FOREIGN KEY (sub_department_id) REFERENCES sub_departments(id) ON DELETE SET NULL
-);
-
--- Work allocations table
+-- Create work_allocations table
 CREATE TABLE IF NOT EXISTS work_allocations (
-    id INT PRIMARY KEY AUTO_INCREMENT,
+    id INT AUTO_INCREMENT PRIMARY KEY,
     employee_id INT NOT NULL,
     supervisor_id INT NOT NULL,
     contractor_id INT NOT NULL,
     sub_department_id INT,
-    activity VARCHAR(100),
+    activity VARCHAR(255),
     description TEXT,
     assigned_date DATE NOT NULL,
-    status ENUM('Pending', 'InProgress', 'Completed', 'Cancelled') DEFAULT 'Pending',
     completion_date DATE,
+    status ENUM('Pending', 'InProgress', 'Completed', 'Cancelled') DEFAULT 'Pending',
     rate DECIMAL(10, 2),
     units DECIMAL(10, 2),
     total_amount DECIMAL(10, 2),
     created_at TIMESTAMP DEFAULT CURRENT_TIMESTAMP,
-    updated_at TIMESTAMP DEFAULT CURRENT_TIMESTAMP ON UPDATE CURRENT_TIMESTAMP,
     FOREIGN KEY (employee_id) REFERENCES users(id) ON DELETE CASCADE,
     FOREIGN KEY (supervisor_id) REFERENCES users(id) ON DELETE CASCADE,
     FOREIGN KEY (contractor_id) REFERENCES users(id) ON DELETE CASCADE,
     FOREIGN KEY (sub_department_id) REFERENCES sub_departments(id) ON DELETE SET NULL
 );
 
--- Attendance table
+-- Create attendance table
 CREATE TABLE IF NOT EXISTS attendance (
-    id INT PRIMARY KEY AUTO_INCREMENT,
+    id INT AUTO_INCREMENT PRIMARY KEY,
     employee_id INT NOT NULL,
     supervisor_id INT NOT NULL,
-    check_in_time DATETIME NOT NULL,
+    check_in_time DATETIME,
     check_out_time DATETIME,
     work_date DATE NOT NULL,
-    status ENUM('CheckedIn', 'CheckedOut') DEFAULT 'CheckedIn',
+    status ENUM('CheckedIn', 'CheckedOut', 'Absent') DEFAULT 'CheckedIn',
     created_at TIMESTAMP DEFAULT CURRENT_TIMESTAMP,
-    updated_at TIMESTAMP DEFAULT CURRENT_TIMESTAMP ON UPDATE CURRENT_TIMESTAMP,
     FOREIGN KEY (employee_id) REFERENCES users(id) ON DELETE CASCADE,
-    FOREIGN KEY (supervisor_id) REFERENCES users(id) ON DELETE CASCADE
+    FOREIGN KEY (supervisor_id) REFERENCES users(id) ON DELETE CASCADE,
+    UNIQUE KEY unique_attendance (employee_id, work_date)
 );
 
--- Insert default departments
-INSERT IGNORE INTO departments (name) VALUES 
-    ('Tudki'),
-    ('Dana'),
-    ('Groundnut');
+-- Create contractor_rates table
+CREATE TABLE IF NOT EXISTS contractor_rates (
+    id INT AUTO_INCREMENT PRIMARY KEY,
+    contractor_id INT NOT NULL,
+    sub_department_id INT,
+    activity VARCHAR(255),
+    rate DECIMAL(10, 2) NOT NULL,
+    effective_date DATE NOT NULL,
+    created_at TIMESTAMP DEFAULT CURRENT_TIMESTAMP,
+    FOREIGN KEY (contractor_id) REFERENCES users(id) ON DELETE CASCADE,
+    FOREIGN KEY (sub_department_id) REFERENCES sub_departments(id) ON DELETE SET NULL
+);
 
--- Insert Groundnut sub-departments
-INSERT IGNORE INTO sub_departments (department_id, name, primary_activity) 
-SELECT id, 'Mufali Aavak Katai', 'Loading/Unloading' FROM departments WHERE name = 'Groundnut'
-UNION ALL
-SELECT id, 'Mufali Aavak Dhang', 'Loading/Unloading' FROM departments WHERE name = 'Groundnut'
-UNION ALL
-SELECT id, 'Dhang Se Katai', 'Loading/Unloading' FROM departments WHERE name = 'Groundnut'
-UNION ALL
-SELECT id, 'Guthli Bori Silai Dhang', 'Loading/Unloading' FROM departments WHERE name = 'Groundnut'
-UNION ALL
-SELECT id, 'Guthali dada Pala Tulai Silai Dhang', 'Loading/Unloading' FROM departments WHERE name = 'Groundnut'
-UNION ALL
-SELECT id, 'Mufali Patthar Bori silai dhang', 'Loading/Unloading' FROM departments WHERE name = 'Groundnut'
-UNION ALL
-SELECT id, 'Mufali Patthar Bori Utrai', 'Loading/Unloading' FROM departments WHERE name = 'Groundnut'
-UNION ALL
-SELECT id, 'Bardana Bandal Loading Unloading', 'Loading/Unloading' FROM departments WHERE name = 'Groundnut'
-UNION ALL
-SELECT id, 'Bardana Gatthi Loading', 'Loading/Unloading' FROM departments WHERE name = 'Groundnut'
-UNION ALL
-SELECT id, 'Black Dana Loading/Unloading', 'Loading/Unloading' FROM departments WHERE name = 'Groundnut'
-UNION ALL
-SELECT id, 'Pre Cleaning', 'Pre Cleaning' FROM departments WHERE name = 'Groundnut'
-UNION ALL
-SELECT id, 'Destoner', 'Destoner' FROM departments WHERE name = 'Groundnut'
-UNION ALL
-SELECT id, 'Water', 'Water' FROM departments WHERE name = 'Groundnut'
-UNION ALL
-SELECT id, 'Decordicater', 'Decordicater & Cleaning' FROM departments WHERE name = 'Groundnut'
-UNION ALL
-SELECT id, 'Round Chalna', 'Round Chalna & Cleaning' FROM departments WHERE name = 'Groundnut'
-UNION ALL
-SELECT id, 'Cleaning', 'Decordicater & Cleaning' FROM departments WHERE name = 'Groundnut'
-UNION ALL
-SELECT id, 'Round Chalna No.1', 'Round Chalna No.1' FROM departments WHERE name = 'Groundnut';
-
--- Note: Admin user will be created by running: npm run seed
--- This ensures the password is properly hashed with bcrypt
+-- Create indexes for better query performance
+CREATE INDEX idx_users_role ON users(role);
+CREATE INDEX idx_users_department ON users(department_id);
+CREATE INDEX idx_users_contractor ON users(contractor_id);
+CREATE INDEX idx_work_allocations_employee ON work_allocations(employee_id);
+CREATE INDEX idx_work_allocations_supervisor ON work_allocations(supervisor_id);
+CREATE INDEX idx_work_allocations_contractor ON work_allocations(contractor_id);
+CREATE INDEX idx_work_allocations_date ON work_allocations(assigned_date);
+CREATE INDEX idx_work_allocations_status ON work_allocations(status);
+CREATE INDEX idx_attendance_employee ON attendance(employee_id);
+CREATE INDEX idx_attendance_date ON attendance(work_date);
+CREATE INDEX idx_attendance_status ON attendance(status);
+CREATE INDEX idx_contractor_rates_contractor ON contractor_rates(contractor_id);
+CREATE INDEX idx_contractor_rates_date ON contractor_rates(effective_date);