We all know that time equals money, but this statement is especially true when it comes to employees working on the clock. Employers pay dearly for their employee’s time, including wages, payroll taxes, benefits and so on. Unfortunately, many employers are also overpaying for labor and often are suffering significant financial loss due to time theft and/or time fraud.
Without an automated time and labor system, recurring time theft is common. Although employers are required to maintain accurate workforce time records for compliance, many methods today are costing employers thousands each month and year.
Is your organization overpaying due to time theft? Perhaps you’re not aware of the common sources. Let’s touch on the most common forms of time theft or fraud.
- Buddy punching – One of the most common forms is when one employee clocks in for another running late to work or from a break. Fortunately, this problem is easily solved with an inexpensive biometric time clock.
- Punch Approximating – When employees are expected to manually enter or record their punch times, punch approximating occurs. Late arrivals and early departures are a weekly occurrence for many employees. Typically, they will round to the nearest 15-minute increment… in their favor. When their time is forgotten altogether, they often round to the scheduled time. With an average of four punches per day, this can quickly result in 10-30 minutes of extra hours per day per employee.
- Punch card manipulation – If your employees are managing their own timesheets through a spreadsheet or other method that doesn’t automatically capture the employee’s time, there is a strong possibility of time manipulation to cover for things like extended lunches and personal errands. Eliminate these extra costs and added administration for employees with an automated timesheet calculator.
- Personal activities while on the clock – While this is more of a management challenge, a common form of time fraud is employees engaging in personal activities while on the clock. Making the clock in/out process more convenient along with clear guidelines in your Employee Handbook can reduce this problem.
- Unauthorized Overtime – When reporting is inefficient, it’s common for employees to accrue small or even significant amounts of unauthorized overtime each week. While this may not always be the result of time fraud, it’s a cost that can be minimized through automation and reporting.
- Employees approving their own time card – Without an automated timekeeper, obtaining approvals by all the necessary parties can be difficult. With it, approvals by supervisors, HR and employees can happen in a couple minutes and edits can be audited to ensure the proper users are making the edits.
- Reporting off-site work hours – When employees work off-site, tracking time can be a challenge. Employees often inaccurately report hours, but with our mobile timesheet app that includes GPS punch location tracking, this problem is solved.
Wage theft is far more common than most employers realize, but the solution is simple and affordable, and one that pays for itself each pay period. Contact 941 Timekeeping to learn more about saving with automated timekeeping.