Discipline is essential , however how you implement it , is your choice. You have an option to introduce rules as mentioned by Ulalme with degrees of punishment as applicable. Penalties are important , however, it bring its frictions along with it.
You can alternatively take a different approach. Assuming that you are aware of the reason why they are late ? In your capability as an HR and Management , how far can you go to resolve them? Have you found the options on how to ensure they reach in time?
What are the chief reasons that you have observed so far? Do they stay far away or they are not able to manage time , due to over load of responsibilities?
Its easy to punish, however before you set the guidelines and the penalties, please ensure that you did your best to support them. You need to gain confidence before you can create frictions.
Incase you are not completely aware of the problems faced while reaching office, consider calling for an All-Hand's Meet or a Focus Group Meeting. Brainstorm with your employees on how to resolve them . Make them a partner in this project to maintain discipline within the firm. Every employee may have their unique problem for not being able to reach office on time. Please make sure you do enough to support them, before you implement penalties. You can take this opportunity and build a Peer-To-Peer Mentoring Program. Let your employees mentor each other through these challenges. What one cannot think, the other may offer it as a solution.
Here are few options for your to consider. The first option to you is to offer pick-up and drop. That way you least likely to miss out on timeliness.
In case you don't have the budget to fund the transport, can you initiate a ride-sharing process? There are apps such as Let's Ride, that allow you to car or bike pool.
Incase this is not possible, please consider the option to offer flexi-timing , where the employee logs in for 8.5 hours and clocks it within the office time period of 8.00 am - 5.00 pm or 9.00 am - 6.00 pm . That way you will have less hassles to penalise. The employees may actually welcome this with more productivity.
In an office I worked, we had several escalation while managing late reporting to work. Hence the Centre Lead called for a Process Improvement Meeting every day in the first hour. Everyone was free to join and contribute in it , irrespective of their roles and reporting orders, they could pick any project they want. This made the interest level in the employees shoot high and the ownership increase. Every body wanted to be a part of an Process Improvement Program in some or the other project. Needless to mention this was an high visibility event. It was a zero-cost employee engagement building program, which worked brilliantly.
In your situation you may need to think it differently. Employee satisfaction doesn't lie in the pay package or the designation but the work culture that you build in.
Engage them meaningfully for growth , towards a shared vision and it will offer the best pay off ever!
Last but not the least, please remember its always easy to punish , but takes eons to build trust. May you utilise this opportunity to build a better firm.
Wishing you all the best!