The Mystery Behind the Error
We often get reports that the servers are displaying the wrong time within a user's session. In these cases it is almost always off by an hour.
Each server is set to the correct time in the Eastern Timezone (GMT -05:00) when it is first built and loaded. The problem is that not all customers are located in the same timezone that the servers are, and thus the time would always be wrong.
To get around this problem Microsoft devised a way for the server to read what timezone you are connecting in from and using that information it is able to calculate the difference between it's locally configured setting (GMT -05:00) and whatever your timezone is. Once it calculates the offset between the two timezones it is then able to adjust the clock settings within your user session to display the correct time.
This ingenious solution worked out perfect, but it has a few requirements in order for it to display correctly.
Firstly, the server itself must be configured to the correct date/time/timezone and have daylight savings time enabled. Second, since Daylight Saving Times tend to change from time to time and year to year the servers must be kept up to date with Windows Updates so that they properly conform to the current DST standards.
And since the server bases its calculations in part with the clients computer timezone then it likewise stands to reason that these requirements also apply to the local client computer as well. If one or the other is off, then the calculations will be incorrect and the time displayed will follow suit.
We run updates on all of our servers routinely each month to ensure they are kept up to date and that all the date/time/timezone settings are correct.
How To Fix It
A few simple steps are required to fix this issue. First, log off the server. You will need to be logged off before you make these changes or else they will not take effect until the next time you log out and back in.
Make sure your local time and date are correct. Double-click on the time display in the system tray on the bottom right-hand corner of your screen.

You will see the Date and Time Properties dialog box displayed. Use this to configure the correct date/time if needed.

Once you have this set correctly then switch over to the Time Zone tab and configure the correct settings for your region.

Make sure that you have the setting for Automatically adjust clock for daylight saving changes checked, else the time settings on the server will be miscalculated.
Click OK to save your changes and then log back into the server to see if this resolves your issue.
The Clock is Still Wrong
If your time display on the server is still off then it likely means your local computer is not up to date with its Windows Updates and does not have the current DST settings loaded for your region.
This is simple to fix, but depending on how far out of date you are with your updates it could take an hour or so and require several reboots of your computer to complete. This includes applying all available Service Packs and Critical updates to your workstation or PC.
You can check your version of Windows and the currently installed service pack by right-clicking on My Computer and selecting Properties from the list.
Current verisions for Windows as of November 2008:
Windows 2000 and 2000 Server: Service Pack 4 (SP4)
Windows XP Home and Professional: Service Pack 3 (SP3)
Windows Server 2003: Service Pack 2 (SP2)
Windows Vista (All Versions): Service Pack 1 (SP1)
Windows Server 2008: Service Pack 1 (SP1)
If your Service Pack is up to date then you should not have as long a wait to complete the update process as those who are not. Loading Service Packs takes longer because they are usually large downloads (in excess of 100 MB generally) and they always require a reboot of the computer to complete. If you have to load one of these it is best to do so after you are finished with the computer or if you have a secondary computer to use while this one is being updated.
You can download all Windows Updates (including Service Packs) for free from Microsoft - assuming you are not using a pirated copy of the OS - by going to their Windows Update website. To do this, click on START > Programs > Windows Update.

Alternately, if you cannot find this icon you can simply browse to http://update.microsoft.com/ to access the downloads site. This may require an update in itself to load the page, or an installation of ActiveX conrols, etc. Follow any prompts that you are given when you try to go here but make sure that anything you are asked to install is digitally signed by Microsoft Corporation before accepting.
Once you have the page up simply click on the Express updates button. This will load only critical security updates to your computer and will ignore optional updates that you don't need. (DST changes are considered critical updates and will be included in the Express updates list.)

When you click this button you will have to wait while the update servers detect which updates you already have and which ones that you need. This process can take a few minutes depending on your internet connection and computer speed.
Once completed you will be given a summary of which updates are available. It is recommended that you install all High Priority updates available unless you have specific reasons not to. Click on the Install Updates button to begin the download.

Follow the prompts until the updates are complete and then reboot if necessary. Keep repeating the steps to log in to Windows Updates website and clicking on the Express updates until you are prompted that there are no more available updates.

You should now be able to log in to the server and see the correct time displayed. If not, then contact your technical support team for assistance.
Related Links about Daylight Savings Time in Windows
http://support.microsoft.com/kb/928388
http://support.microsoft.com/gp/DST_topissues