Competition in business seems to only accelerate with time, and employers continue to work hard to turn a profit each month and year. With so many inputs and moving parts at play, it can be difficult for employers to efficiently track all costs. Would it surprise you to hear that although workforce expenses are among the greatest, they can also be one of the most poorly tracked, and laden with unnecessary loss due to employee time theft? Fortunately, these problems now have a solution with time clock automation.
Causes of Employee Time Theft
Employee time theft is when employees accept pay for time or work not performed. It’s a common problem in many companies, and can occur in numerous ways. For simplicity, we’ll identify three causes. First, in some cases, employees are simply undisciplined, resulting in perhaps 15 to 60 minutes of lost productivity per day. For example, they arrive late, leave early and take longer breaks than allowed. Second, employees can be dishonest. They are aware of the behavior, but simply don’t care to change or may even make efforts to deceive an employer. And finally, in some cases, the employer is using antiquated methods to track time, which are rampant with human error, mistakes and financial loss.
Most Common Time Theft Behaviors
The most common types of time theft affect many companies, and most likely affect all who are not already using an automated time card calculator, time clock or timesheet to track time. Let’s take a look at a few of the biggest offenders:
- Employee “Buddy Punching” – When employees are running late or need to run an errand on route to and from work, buddy punching can often occur. The American Payroll Association estimates that as much as 75% of companies are affected by buddy punching, which is simply when one employee clocks in for another. Perhaps the only way to truly fix this problem is to implement a biometric (fingerprint) time clock to verify employee punches as they occur. At 941 Timekeeping, we solve this problem often.
- Employee Punch Approximations – When employees are expected to keep track of their own timesheet, remember, or estimate in/out times, time theft can be frequent! In most cases, employees will round to the nearest 15-minute increment… and you can bet it’s in their favor! With the typical four punches that occur each day, this often costs employers countless minutes per day. That cost in productivity, extra wages, and overtime is severe for employers each year! Today, this problem is an easy fix with time and labor and/or scheduling software!
- Late Arrival, Early Departure and Extended Breaks – If you’re not using an automated timesheet calculator, you’re likely overpaying for labor. When it doesn’t cost the employee to arrive late, leave early or take extended breaks, it will happen. It’s human nature. With two breaks, lunch, daily arrivals and departures, it’s not uncommon to lose 5 – 15 minutes with each punch per employee. This can be quite costly. By implementing an automated timesheet calculator, however, workforce productivity will go up and employees will improve their timeliness to avoid lost pay.
Although historically, it was difficult to effectively or affordably track employee time and attendance, that’s not the case any longer. Employees and supervisors can effortlessly capture time, note exceptions on time cards, approve punch times, and supervisors even have a full audit trail to better manage punch exceptions. These solutions can also be set up very quickly.
Contact 941 Timekeeping to find out more about how you can minimize time theft and reduce one of your greatest expenses in employee labor.