SELECT em.EmpNo as 'EmpNo', 
case when tf.cDate <> null then tf.cDate else coalesce(tf.cDate, '2012-10-29') end as 'cDate', 
Min(tf.cTime) as 'timeIn', Max(tf.cTime) as 'timeOut'
FROM tFile tf Full Outer join Emp em On tf.EmpNo = em.EmpNo
Group By em.EmpNo,tf.cDate
Order By 'EmpNo'

SELECT em.EmpNo as 'EmpNo', 
--You should not compare NULLs with = or <> because it will always return unknown and never true
-- To compare NULLs use IS NULL or IS NOT NULL
--case when tf.cDate <> null then tf.cDate else coalesce(tf.cDate, '2012-10-29') end as 'cDate', 
--In this case, you don't need the CASE, a simple COALESCE or ISNULL will work
--I prefere ISNULL where there are only 2 possible values
ISNULL(tf.cDate, '2012-10-29') as 'cDate', 
Min(tf.cTime) as 'timeIn', Max(tf.cTime) as 'timeOut'
FROM tFile tf RIGHT OUTER JOIN Emp em On tf.EmpNo = em.EmpNo AND tf.cDate = '20121029'
--You don't have anything to filter your data. In this case, the filter will be in the JOIN to avoid an INNER JOIN
-- I turned your FULL JOIN into a RIGHT JOIN
Group By em.EmpNo,tf.cDate
Order By 'EmpNo'

declare @emp table(EMPNo varchar(10),fullnam varchar(20))

declare @tfile table(EMPNo varchar(10),CDate datetime,Ctime datetime)

insert into @emp
select * from 
(
 Values
('0001','xyz1'),
('0002','xyz2'),
('0003','xyz3'),
('0004','xyz4'),
('0005','xyz5')
)a (no,name)


insert into @tfile
select * from 
(
 Values
('0001','10/29/2012','2012-10-29 07:52:00.000'),
('0001','10/29/2012','2012-10-29 19:00:00.000'),
('0002','10/29/2012','2012-10-29 07:40:00.000'),
('0002','10/29/2012','2012-10-29 19:32:00.000'),
('0005','10/29/2012','2012-10-29 07:58:00.000'),
('0005','10/29/2012','2012-10-29 18:35:00.000')
)a (no,cdate,ctime)

-----------------------------------------------------------------------------------------
select a.EMPNo,cdate,MIN(Ctime) AS timeIn ,MAX(Ctime) AS timeOut
from @emp a
LEFT join @tfile b on a.EMPNo=b.EMPNo AND CDate='10/29/2012'
GROUP BY a.EMPNo,cdate
ORDER BY A.EMPNo