Tick-tock, tick-tock … That’s the sound of profits being squeezed by employee time theft.
The act of “stealing” through time manipulation is a serious issue in the business world. How common is it? According to the American Payroll Association, 75% of businesses in the U.S. are affected, and the average employee steals more than four hours a week. That’s more than 200 hours a year! Even more surprising: A 2015 Software Advice survey concluded that 43% of hourly workers admitted to exaggerating the amount of time they worked, and 25% said they report more hours than they actually work 76%-100% of the time!
As harsh as it sounds, if you have employees, you’re most likely a victim of time fraud. What can you do to combat this illegal activity? First, it’s important to understand what time fraud is and how it occurs in your business. Once you understand the at-risk areas, you can implement steps to reduce future loss.
How Employees Steal Time, Intentionally and Unintentionally
There’s a chance you’ve suspected employee time theft in the past but haven’t been able to prove it. To help you better understand where this happens in your company, it’s important to understand employee intent and what to look for.
Some employees are intentional abusers. They actively seek ways to manipulate the system in their favor. For example, these employees:
- Come in late and leave early
- Purposefully record inaccurate time sheets
- Take longer or more frequent breaks than allowed
- Work on personal activities during business hours
- Use the “buddy punching” technique, where a friend clocks an employee in when he or she isn’t at work
On the other hand, disengaged employees or those with poor attitudes can have an unintentional impact on productivity. Disengaged employees may be dealing with personal problems outside the office or they may be suffering stress due to conflict within the workplace. Regardless of the reason — and even though disengaged employees usually don’t set out to “steal” time — their lack of productivity is cause for concern. It’s important to identify these employees and determine the reason for the disconnect.
And then there are employees with bad attitudes who spend more time complaining than working. Not only do they drain morale, employees with chips on their shoulders often engage others with their griping, which has a cascading negative effect on productivity.
It’s just as important to identify and address these workers as it is to develop procedures that more accurately track time. Doing both will help you recover “lost” or “stolen” time.
Enforce Policies and Leverage TrackSmart to Reduce Employee Time Theft
It’s crucial to have policies for attendance, time reporting, time clock procedures and break times. Clearly documenting policies in an employee handbook sets expectations for what is and isn’t acceptable. Be sure to include language that clearly defines the consequences of abusing company policy. It’s also a good idea to use tools that help you better monitor employee time. TrackSmart has a wealth of reporting resources to help you do this, which will in turn reduce time theft.
Reviewing time-sheet reports can reveal fluctuations in employee costs, hours and potential violations. Manual systems or non-integrated systems leave plenty of room for abuse, but as a TrackSmart user, you have the ability to isolate concerns and address troublesome patterns.
These reports also allow you to analyze data, spot gaps, identify problems and then course-correct. You can monitor which employees are following their schedules, and which aren’t, and then review labor costs daily to identify areas or individuals who are having a negative impact on productivity.
Being aware that employee time theft exists in your business is an important admission. You can quickly improve productivity if you understand what to look for, how to address concerns and how to manage labor costs more effectively moving forward.