Tag: time theft

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5 sneaky ways employees commit time theft (how to stop it)

Summary

  • Time theft is what happens when an employer unknowingly pays an employee for time they didn’t work while on the clock. 

  • Examples of time theft include falsifying time cards, buddy punching, unauthorized or extended breaks, excessive social media use, and personal activities on company time. – More

  • You can deal with time theft by implementing HR policies and utilizing automated time and attendance software. – More

If you discovered that one of your employees was stealing money or equipment from the company, you’d likely reprimand or even terminate them. What you may not realize is that another type of theft is likely happening right under your nose — time theft. 

Software Advice surveyed shift workers and found that 43% of hourly workers admitted to over-reporting the number of hours they actually worked during their workday. This type of employee theft can result in big losses for your organization. If every employee over-reported just 30 minutes of work every day, this could result in thousands of dollars lost to time theft every month.    

To tackle the issue of time theft, you must first understand how your employees could be stealing time in the first place. You should implement a time and attendance policy that clearly states the organization’s stance on time theft, the expectations of the staff, and the repercussions for breaking these policies.

Beyond this, you should consider where your manual time tracking processes are most vulnerable to abuse and seek ways to increase automation across your workforce. 

How to stop time theft for good

What is employee time theft?

Employee time theft occurs when an employer unknowingly pays an employee for time they didn’t work while on the clock. 

It’s primarily applicable to hourly employees more so than exempt employees. If left unchecked, employee time theft costs can eat away at your monthly wage cost budget very quickly. 

One of the more egregious cases of employee time theft involved a US Postal Service employee in Washington, D.C., who received $31,000 in wages for jury service that the employee claimed lasted 144 days. The theft investigation revealed that the employee had actually been discharged from jury duty but forged court papers to persuade his employer to pay him for what turned out to be a very long vacation.

Your time theft problem might not be as bold as the US Postal Service’s. Smaller, everyday occurrences of time theft are more difficult to spot but still negatively affect your organization’s bottom line and employee productivity. 

1. Falsifying time cards

The falsification of a time card occurs when an employee provides inaccurate data about their working hours or causes others to provide misleading information. This typically occurs with manual timekeeping systems or tracking employee hours with a time clock.

For example, say an employee only works 30 hours in a week but claims 40 hours of work time on their timesheet. Or deceitfully claims to have worked an entire shift, such as at the end of 2022, when a Polk County firefighter was arrested for falsifying his time cards. He had received a total of $1,265.04 for three 24-hour shifts he did not work.  

Solution — use automated time tracking software.

Paper timesheets are the simplest way for employees to steal time, and physical time clocks allow for multiple excuses: “So-and-so lost their time card, so I loaned them mine,” or “I lost my swipe card.” With time clock software, you can prevent fraudulent time theft and early clock-ins and prompt employees to clock back in via mobile apps when their breaks are over.

A mobile tracker app also empowers managers to follow employees in real-time from anywhere and continue tracking when an employee clocks in. Workforce.com’s mobile time clock app helps you manage employees’ time and administer digital timesheets, payroll, budgeting, and labor compliance reporting. 

You also can track remote employees’ locations via their GPS clock-in. These tools work everywhere and show you their exact location at a glance. You can restrict their clocking in or out at your job site or see where an employee who always has an excuse for being late is actually spending their time.

2. Buddy punching

Another form of time theft is when an employee clocks in or out for a coworker. This is often referred to as buddy punching. Companies that operate using rudimentary procedures around clocking in are at higher risk of having their employees cheat the system in such a way.  

Solution — automate clock-in and clock-out procedures.

Time and attendance software like Workforce.com makes buddy punching virtually impossible. Employees automatically punch in and out through their smartphones using photo identification and passcodes – this ensures that the right person has clocked in for the right shift. 

3. Unauthorized or extended breaks

Employees deserve their break time — breaks are required by law in some states. But there is room for abuse. Employees could easily extend their lunch break time by a few minutes on a regular basis. Excessive cigarette breaks are also often flagged as a cause for concern. In light of the time used up on smoke breaks, one UK-based company even awarded its non-smoking employees four extra days of time off.

Solution — build a healthy break culture that is effectively managed through scheduling and tracking solutions.

Taking lunch breaks from time to time is important for employee engagement and productivity. So, regulating your team’s break activities shouldn’t be done in a way that puts them off from taking theirs altogether. Create a healthy break culture within your team by doing things like: 

  • Encouraging staff to actually take their breaks
  • Having management take breaks themselves and lead by example
  • Providing pleasant spaces for your employees to take their breaks in
  • Offering catered lunches

Furthermore, Workforce.com’s scheduling solution automatically allocates rest breaks that are compliant with state law. This information is also readily available for employees through their employee app. 

This way, your employees get the rest they need without taking longer breaks that ultimately constitute time theft. 

4. Excessive social media usage

Social media use on the clock is inevitable. When it happens consistently, it can be considered a type of time theft. One study by Desktime found that of the time employees spend on non-work-related websites, nearly 50% of that time is on social media. 

From the time spent on work-unrelated websites, social media takes up 49.1%. 

Solution — incorporate clear guidelines about social media use into your company policy.

Employees using social media and checking their phones while at work is inevitable, to some extent, and attempting to cut it out altogether will likely cause resentment. Instead, develop clear policies on acceptable social media use in the work environment. Your policy could include information on:

  • The distinction between social media use for work purposes (if applicable) and for personal use
  • Times and places for personal social media use; for example, employees can only use it during their break times and not in the work area
  • Policies around posting photos or videos on company property and/or wearing company uniforms

5. Personal activities on company time

You may experience employees who have no problem carrying out personal tasks while on the clock. This could include taking personal calls, online shopping, running errands, or even running their side business. Excessive socializing between coworkers could also be considered time theft.

Solution — create a great sense of ownership and accountability amongst your team. 

There are a number of ways employees can avoid working and take personal time during their work shifts. Turning your workplace into a police state is one way to handle the problem, but it would negatively impact your team’s morale. 

Alternatively, you should strive to create a work environment that prioritizes and harnesses employee satisfaction. When employees care, their loyalty and productivity increase. Implement a system of employee rewards and recognition. Grant time off — or add in an extra shift — for shift workers who excel in their roles. Creating a culture of honesty, transparency, and trust helps prevent time theft.

It is important to communicate with your team to understand what needs to be done to help boost employee morale. 

As Tom Smith, co-founder of Partners in Leadership and three-time New York Times bestselling author, once said, “An attitude of accountability lies at the core of any effort to improve quality, satisfy customers, empower people, build teams, create new products, maximize effectiveness, and get results.” 

Dealing with employees who have committed time theft

Dealing with employees who have been caught buddy punching, taking longer breaks than allowed, or committing any other type of time theft can be tricky. Your first instinct might be to refuse to pay that employee for the time they have stolen, but this can prove to be more costly down the line. 

If you refuse to pay for the hours worked because you think they were falsely reported, you could be drawn into a costly wage-and-hour lawsuit for back pay.

And, if you respond to the lawsuit with a claim of employee time theft, it could be considered retaliation against the employee. Be sure you have a reasonable basis for filing the claim to avoid retaliation.

You are much more susceptible to wage-and-hour and overtime lawsuits with lax time and attendance policies or unsophisticated timekeeping practices. Business owners are turning to automated time-tracking solutions to monitor employee hours.

Create time and attendance policies

It is important to establish clear and specific time and attendance policies and ensure that they are communicated well to your staff. If your team isn’t aware of what is expected from them when it comes to attendance and time theft, how can they abide by your rules?

Ensure your team knows why you are implementing the policies and what is expected of them.

The first thing to do is consult with your employment law attorney regarding local, state, and federal time-theft regulations. An employer can work with you to develop clear, consistent policies regarding clocking in and out procedures, break periods, and cell phone and social media use while clocked-in. It’s crucial that employees fully understand their work-related responsibilities and know what they should be doing when there are lulls in the workday.

Immediately incorporate these policies into your employee handbook. All hourly and salaried employees must review and sign a document stating they have read and understand the policies in the handbook. Also, post reminder signs in high-traffic areas and send alerts through mobile apps so employees can see them. 

Follow through on procedures and disciplinary actions

You don’t want to punish employees. It’s costly and emotionally draining for all involved, and it can suck the morale out of a workplace. But you need preventative measures in place should you discover evidence of time theft. 

Develop and communicate in your handbook the disciplinary procedures to deal with time theft. This may include a program in which you initially issue a verbal warning followed by a written warning or establishing a performance improvement plan that’s ultimately followed by suspension and concluding in termination. 

If it reaches that point, Findlaw.com states that if an employee is suspected of stealing time, it’s up to you to conduct a fair, accurate investigation. Someone other than the person who discovered the theft of time should investigate it, strict confidentiality must be maintained, and you should enlist expert help from a CPA, an attorney, or other relevant professionals.

Compliance with wage-and-hour laws is a headache and difficult to track. Constantly turning to a labor law attorney gets expensive quickly. The laws, regulations, and ordinances can be overwhelming, and a wrongful termination suit is costly. Workforce.com’s compliance platform ensures simplified and automated compliance with federal, state, and local labor regulations.

Stay on top of time theft with Workforce.com

Time theft doesn’t have to be a cost of doing business. It’s challenging to deal with time theft and recoup losses, but Workforce.com has the systems and processes that empower you to prevent time-theft losses from ever occurring again.

Here are a few practical ways Workforce.com helps you crack down on time theft:

Geofencing

Geofencing technology allows you to limit the radius in which employees can use their mobile time clock to punch in for work. This means they always have to be physically present at work to clock in, preventing them from clocking in at home while running late.

Photo identified clock-ins

With Workforce.com’s time clock, staff take a quick selfie every time they clock in for a shift. These photos accompany every timesheet, helping managers confirm employees are who they say they are when clocking in. Photo identification like this prevents buddy punching, a common form of time theft.

Time clock passcodes

If you opt to use a single tablet as a time clock for all staff members, Workforce.com assigns everyone unique passcodes. Employees use these passcodes to securely clock in and out of work without anyone else doing it for them.

Meal and rest break clock outs

You can automatically apply lunch breaks to every shift you create in Workforce.com. If an employee has a break scheduled, they must physically clock-out and then clock back in once their break is complete. This break time is then recorded on their time sheet. Having a specific break button like this ensures an employee never takes unauthorized extended breaks.

Real-time solutions like Workforce.com’s time and attendance system prevent time theft and streamline the payroll process. Automated solutions also provide your managers with a worry-free system so they can focus on running a business and not hovering over a time clock. But don’t take our word for it. Check out the free webinar below, where Forrester Research dissects the ROI businesses can expect from time and attendance platforms: 

Webinar: Building a Business Case for WFM

Build your culture, track employee hours, and crack down on time thieves with Workforce.com’s time and attendance software. Start a free trial today.

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Preventing employee time theft in restaurants

Summary

  • Employee time theft is when employees are paid for work they did not do

  • Employee time theft can come in various forms

  • Restaurant managers can prevent time theft with workforce management software

As a manager of a restaurant, when you think of employee theft in the workplace your mind may automatically go to blatant examples, such as staff stealing equipment, cash from the register, or even snacking on supplies. However, there’s a less blatant form of workplace theft: employee time theft.

While employee time theft is not always easy to spot, the impact is. Employee time theft directly impacts labor costs, and sadly, it’s not uncommon. Time theft can be prevented by investing in innovative time tracking software that ensures maximum employee productivity at all times.

What is time theft?

Time theft is when an employee is paid for time they didn’t work. It typically applies to hourly employees rather than exempt employees. Therefore, as a restaurant manager, you are at a high risk of being a victim of employee time theft.

What does the law say about time theft?

Unfortunately for employers, there are no explicit federal time theft laws, which puts businesses in a vulnerable position. While there are ways some businesses may be able to recoup losses through a civil suit, there is no guarantee this will be successful. So, employers need to make sure they’re doing everything they can to prevent time theft in the work environment.

Recognizing time theft in restaurants

There are different forms of time theft. Here are the major ones to look out for:

  • Falsifying timesheets: This is when employees misrepresent work hours. For example, an employee only worked 30 hours in a week, but they doctor their timesheet and say they worked 45 hours. If your restaurant uses temporary staff from staffing agencies, this is something to watch out for. A restaurant in Florida found it had $10,000 added to its payroll costs when a temp agency worker fraudulently misrepresented his work hours.
  • Buddy punching: This is when an employee clocks in and out for a coworker. If an employee is running a few minutes late and doesn’t want this to be recorded, they may ask a coworker (who’s already in the restaurant) to clock in. The reverse can also be true, employees can leave their shift earlier than scheduled, but have their buddy clock out for them.
  • Extended breaks: Employees may take too long on lunch breaks or go for unauthorized breaks like smoke breaks. This is likely to happen where there’s easy access to a back door.
  • Doing personal tasks during the workday: Instead of clearing tables, wait staff are surfing social media on company time or sneaking off to the restroom to take personal calls. A 2020 Digital Distraction & Workplace Safety survey revealed that the average employee spends 2.5 hours each workday looking at digital content that is unrelated to their job.

Uncovering time theft in your restaurant

While time theft can be difficult to prove, here are a few pointers that you may realize at your workplace:

 How to prevent time theft

Prevent time theft by using innovative scheduling and timekeeping software that ensures there’s no lost productivity from employees.

Use accurate scheduling software

According to the Fair Labor Standards Act (FLSA), employers must pay staff according to what’s recorded on the timesheet. Therefore, it’s important that your scheduling software creates the right shifts in the first place. Moreover, all schedules should properly align with hours reflected on timesheets, as this will prevent paying employees for hours they didn’t work.

Use an automated time clock solution

Eliminate the risk of falsifying time cards with a time clock app. Here’s how it works:

    • Staff clock in and out in an app with their personal IOS and Android devices.
    • Managers can guarantee the right worker is in the right shift, at the right place, at the right time with unique clock in/out passcodes, electronic photo verification, and GPS location data. This will directly eliminate buddy punching.
    • All clock-in data is automatically recorded, and the app generates electronic timesheets — the perfect solution for business owners who are tired of using stacks of binders full of paper timesheets.

Give your managers the ability to manage operations during the day

Provide your managers with a time and attendance system that stays on top of employee productivity. Managers should be able to monitor employees remotely — all from a computer or mobile device. This kind of monitoring should take the form of a live timeclock feed and tardiness notifications.

Managers should also receive notifications when employees clock in and clock out for breaks. With these instant notifications, it’s possible to cross-reference clocking in and out with the shift schedule to make sure there are no discrepancies in break times. Giving managers the ability to manage operations during the day ensures they can easily spot time theft.

Create and enforce firm time and attendance policies

Create attendance policies and communicate them clearly to your staff. Your staff might be unaware of their actions and how they can be perceived as time theft, so it’s important they know what time theft is and how they may be breaking company policy.

Make sure time and attendance policies include clocking in and out procedures, break periods, and cell phone and social media usage when on the clock. It’s crucial that employees know what time theft is and understand that it will not be tolerated. If necessary, make sure policies are enforced with disciplinary actions, as they may act as a deterrent.

Provide an enjoyable work environment

Burnout, low pay, and minimal benefits may make employees more likely to commit time theft. Employers should provide staff with enjoyable working environments where they feel valued, taken care of, and respected – this always helps reduce time theft. Consider implementing something like an employee reward system to create a culture of positivity and motivation. You could also regularly grant time off — or add in an extra shift — for workers who excel in their roles.

Prevention is better than a cure

While you can’t go back in time to stop prior time theft, you can certainly take steps to prevent it from continuing. Use automated workforce management software to empower employees to make the most of the hours they’re scheduled for. Contact us today to learn how you can get started.

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Knock out the practice of buddy punching for good

buddy punching; clocking in

Clocking in for a colleague may come as a wink and a nod between coworkers. But the practice of buddy punching is time theft, plain and simple, and it can land a gut punch to managers trying to ring in their scheduling problems and labor costs.

However, advances in workforce management technology and mobile solutions are pulling no punches against those clocking in for a colleague who is running late or worse, randomly decides to take an unauthorized day off.

 What constitutes time theft

It may start innocently enough. The train is stuck. The babysitter arrived late. But without a manager’s approval, time theft is easily defined.

  • Employees start shifts late.
  • An employee leaves shifts early.
  • They take breaks that are longer than scheduled.
  • They work overtime that wasn’t authorized
  • An employee engages in personal or non-work-related activities while on the job.

And then there is buddy punching.

The financial sting of buddy punching

Time theft puts an alarming drain on an organization’s finances. One 2018 estimate pegs the cost of buddy punching at over $370 million in payroll costs annually, and according to research by the American Payroll Association, buddy punching affects about 75 percent of U.S. small businesses.

Also read: Make managers more successful with the tools to retain and engage their employees

Additionally, businesses lose 5 percent of their annual revenue to employee fraud, and buddy punching is fraud. Businesses with fewer than 150 employees are more likely to take it on the chin due to employee fraud schemes like time theft.

What leads to buddy punching 

buddy punching; clocking in

Some employees simply will take advantage of a situation when they know they can. A lack of adequate technology with proper checks and balances often sets the path to one worker punching in for another. Even implementing a system with RFID cards or passwords can be manipulated.

Lacking proper technology, multiple employees can utilize passwords and credentials to punch in for one another if the system does not detect who uses the password, and employers have a difficult time proving time theft.

Employers also naively foot some of the blame. They can develop a false sense of security since they may have hired and gotten to know the people working for them. And, because they know them, they are confident that none are bad people who would steal from them. Adequate workforce management software creates a more objective, unbiased approach to the time and attendance process.

Counterpunching time theft

There are solutions to sparring with buddy punching. By automating how staff members clock in and out with mobile solutions, not only can time theft be curbed but hours of needless administrative tasks be cut back.

Record when your employees punch in and out with Workforce.com’s time clock. From ensuring the right person clocks in for the shift to paying staff correctly, it starts with the mobile time clock app.

Such a solution assures that the right person clocks in for the right shift through electronic photo verification and unique passcodes. These, along with payroll add-ons, also let employers do away with lengthy steps in computing payroll.

Going mobile

Mobile time and attendance solutions also help manage employees remotely without having to question time and attendance records. Such automated solutions also build trust. By not relying on pen and paper bookkeeping, employees gain the confidence to know they won’t have to follow up or scrutinize recordkeeping to make sure they are being paid fairly for their work.

Why pay for hours that weren’t worked? Make the practice of buddy punching tap out and fight the scourge of time theft with Workforce.com’s time clock app.