WITH Level1
           AS (-- apply row numbers
               SELECT emp_reader_id ,

                      CAST(dt AS DATETIME) AS [DATETIME] ,
                     ROW_NUMBER() OVER ( PARTITION BY emp_reader_id
                                  ORDER BY dt ) AS RowNum
              FROM trnevents
              ),
        LEVEL2
           AS (-- find the last and next event type for each row
              SELECT   A.emp_reader_id ,
                       A.DATETIME ,
                       COALESCE(NULL, 'N/A') AS LastEvent ,
                       COALESCE(NULL, 'N/A') AS NextEvent
              FROM Level1 A
                   LEFT JOIN Level1 LastVal
                      ON A.emp_reader_id = LastVal.emp_reader_id
                         AND A.RowNum - 1 = LastVal.RowNum
                   LEFT JOIN Level1 NextVal
                      ON A.emp_reader_id = NextVal.emp_reader_id
                         AND A.RowNum + 1 = NextVal.RowNum ),
        Level3
           AS (-- reapply row numbers to row-eliminated set
              SELECT  emp_reader_id ,

                      DATETIME ,
                      LastEvent ,
                      NextEvent ,
                      ROW_NUMBER() OVER ( PARTITION BY emp_reader_id
                          ORDER BY DATETIME ) AS RowNBr
              FROM Level2
              ),
        Level4
           AS (-- pair enter and exit rows.
               SELECT A.emp_reader_id ,
                      A.DATETIME ,
                      B.DATETIME AS ExitDATETIME
               FROM Level3 A
                    JOIN Level3 B ON A.emp_reader_id = B.emp_reader_id
                                     AND A.RowNBr + 1 = B.RowNBr
               ),
        LEVEL5
           AS (--Calculate the work session duration
               SELECT emp_reader_id ,

                      DATEDIFF(second, DATETIME, ExitDATETIME)
                               AS Seconds ,
                      DATETIME ,
                      ExitDATETIME
               FROM Level4
              )

SELECT emp_reader_id ,

          CAST([DATETIME] AS date) AS [dt],
          CAST([DATETIME] AS Time) as [In],
          CAST(ExitDATETIME AS Time) As Out,
          RIGHT('0' +   CAST(Seconds / 3600 AS VARCHAR(2)), 2) + ':'
          + RIGHT('0' +   CAST(Seconds % 3600 / 60 AS VARCHAR(2)), 2) + ':'
          + RIGHT('0' +   CAST(Seconds % 3600 % 60 AS VARCHAR(2)), 2)
                               AS TotalHours
   FROM Level5