Time theft is no joke. It’s a typical occurrence within workplaces that, sometimes, is overlooked. And mind you, it’s a big-ticket dilemma.
Employees who do time manipulation can take years for you to uncover, and what is worse, the longer it takes, the more financial toll your business faces. According to Statistic Brains, employee time theft costs businesses around $50 billion per year. Even small inconsistencies can yield massive figures of money over time due to deceptive time clock reporting.
As the famous idiom says, “A small leak will sink a great ship."
This is one thing we ought to prevent from happening, as much as possible. It'll definitely be a win for you and your company if you're completely armed with knowledge about time theft and its countermeasures.
As you read along, you’ll have a better understanding of the intricacies of time theft, different ways employees do them, and practices to nip this action in the bud.
What is Time Theft?
When your employee didn't work for his/her assigned shift, yet is able to receive payment, that's what you called time theft. This applies mainly to employees working on an hourly-rate basis.
Since employees can, anytime, commit time clock stealing no matter the industry, time and attendance fraud isn't just exclusive to a single position. However, with the existence of time and attendance software, it’ll be easier to check any time manipulation.
As for your employees who are diligently working, this is unfair because of the fact that time theft offenders will receive similar pay as them. Since you will be paying for work with zero results, your company will eventually suffer. And you know what's the harsh reality of time theft? It can produce a sky-high ripple effect in your business.
The Consequences of Time Theft
The tendency is that even employees who work hard enough and accurately track their work hours may likely suffer if you have teams with time theft issues. You may not be fully aware that your team’s overall productivity and attendance value is lower than it should be. If this keeps on, low performance might be the new normal within your organisation.
The likelihood of other employees getting tempted and following the same behaviour is a high probability. If this happens, your workforce's morale will be affected negatively. This could lead to them showing up late and leaving early, taking extended time on breaks, and often using work hours for personal matters.
That said, there is a high chance that toxic employees who are guilty of time theft, may tempt coworkers to do the same.
Different Means of an Employee to Steal Time
Time and attendance fraud are widespread. It can happen regardless of the industry. Employees who are not afraid to try or actually do time theft, can get quite creative with their means, just to avoid working. Here are some typical ways for employees to perform time theft.
This happens when an employee gives incorrect detail about their working hours or provides misleading information to others. Such cases can occur oftentimes when you’re tracking your workforce's hours via manual timekeeping systems. Good thing there are time clock applications to prevent any form of timecard falsification from your team.
Unauthorised extended time on breaks
It goes without saying that employees are entitled to have their breaks, this is mandated by law. However, there seems to be room for abuse. A lunch break for 1 hour can get extended by an extra 15-30 minutes or a rest break can also become a time for a coffee.
This happens when an employee clocks in or out on behalf of a coworker. It is estimated that the cost of buddy punching is over $370 million in wage costs per annum. Not just that, companies lose 5% of their annual revenue to internal theft—which includes buddy punching.
Clock in for work yet doing personal activities
There are employees who have no problem at all doing personal stuff while on the clock. This can include socialising with colleagues, running errands or even finding somewhere for a quick nap.
Persistent or excessive phone calls/texts or use of social media
Employees making phone calls and texts while clocked in is inevitable, but if it occurs consistently, it can be tagged as time theft. Use of social media while on the clock has also become a problem.
How to Prevent Time Stealing From Happening?
Since you now have an idea about time theft. You need to establish a solid framework against employees attempting to do fraudulent actions with their time clock. Now is the moment to carry out these solutions. Here are some proven ways to prevent any form of employee time stealing.
Install software that tracks time and attendance
If there's no way for you to check or validate the number of hours your employees are working, you are just leaving yourself vulnerable to time theft. One of the best ways is to install time and attendance software. A truly helpful tool that ensures staff are not doing unnecessary, non work-related activities while on work time.
It also guarantees your employees are only paid based on the hours they have worked on. Plus, it also tracks tardiness, absences, productivity and other factors that contribute to time theft.
Implement communication transparency between all employees
As an employer, you should be clear about company expectations and rules for your workforce to adhere to, whether they are working remotely or on-site. You should implement stringent rules as to what is acceptable and what is not while working. Keep away from putting any vague impression to avoid misunderstandings.
In addition, so as not to intimidate your employees, make them feel like they belong. Create a friendly and approachable atmosphere that allows employees to express themselves if there are issues. This way, employees are more open to talking about it instead of trying to cover it up with time stealing.
Boost work accountability
This falls under performance management. For employees to feel more accountable for what they do, they need to be incentivised as well as utilising rostering software. This means you need to set objectives, plan and monitor goals, and make employees feel they are part of the team.
They are less likely to commit time theft if they feel like they are not hitting the targets or if they are failing, thus pushing themselves to be more productive with incentives in mind.
As an employer, you need to understand that your staff need breaks once in a while. The workforce will function better if they don’t grind their way too much. The productivity level will spike if there is proper implementation of break structures.
If your employees are aware that they can relax and take breaks, they will be less likely to use work time to recharge their energies.
Get rid of paperwork
One of the most common causes of time theft is human mistakes. Mistakenly completing hand-written timesheets can cost your business thousands. All this with just a simple lack of concentration from a team member.
If there is no proper implementation of company rules and regulations, it's likely for time theft and other related issues to continue. Although occasional mistakes are understandable, you must have an optimal automated system that handles repetitive employee errors. Remember, your business can’t keep on covering payroll costs for employee time theft.
We at RosterElf provide you with a trusted and reliable software solution for your workforce management to effectively prevent time theft. Gone are the days of manual employee tracking processes and timekeeping. Our timekeeping apps can help you and your employees record shifts that translate to a digital timesheet.
Want to know more? Call us at 1300 353 000 and we’ll be happy to assist you.