Whether it be consistently arriving late to work or taking longer breaks than you’re supposed to, both of these actions can be considered as stealing productive hours from the company — time theft. With remote work on the rise, companies also face a higher risk of time theft since it’s harder to keep track of employees.

To help business owners recognize and respond to time theft, in this article we’ll cover the common types of time theft and how to prevent them.

What is Time Theft

Time theft is when an employee receives pay for time that they didn’t actually work, this is considered time theft or stealing company time.

Employers lose about 4.5 hours per week per employee to time theft, making it an issue across different industries

Time Theft

How Time Theft Occurs

Time theft occurs in a multitude of ways, most commonly through logging more hours than actually worked, buddy punching and attending to personal matters while on the clock. A time tracking system can help prevent time theft among employees.

  1. Logging More Hours than Actually Worked: A quarter of employees admit to reporting more hours than they actually worked, which means they get paid for work they didn’t do. This is where a time tracking system can come in handy so that employees’ working hours are accurately documented.
  2. Starting late and leaving early. Departing from work before the end of your shift can cause issues if no one’s there to fill the gap until the next employee takes over your shift. Arriving later than your scheduled start time is also problematic. These actions not only reduce the amount of productivity from the business as a whole, but can also lead to dishonest time entries.
  3. Longer breaks. Most states require a lunch break after working a full day shift, but there is a set amount of time that break is supposed to be. Some range from 10 minutes to a full hour lunch break, but extending your break longer than allowed is one of the many instances of time theft.
  4. Buddy Punching: The most common type of employee time theft is “buddy punching,” when another employee clocks in for another because they are running late or don’t arrive. This issue causes 75% of companies to lose money.
  5. Personal Tasks While on the Clock: Whether this be time spent on the phone or attending to personal matters on company time, task-based time reporting can greatly increase employee productivity.

How Time Theft Impacts Business

Time theft can be costly 💸

Lost productivity means lost revenue for companies. Buddy punching alone costs employers an estimated $373 million a year in payroll costs, according to the U.S. Bureau of Labor Statistics.

According to Statistics Brain, time theft causes companies to lose a whopping $50 billion a year. Even misreporting 15 minutes here and there will add up to a big chunk of time lost if a significant number of employees did it.

It's more common than you think 🤔

Employees can cause 90% of all significant theft losses, according to Willis North America. Time theft occurs across a wide demographic of employees, regardless of age and education level.

How Time Tracking Prevents Time Theft

Time tracking system helps prevent time theft by providing a system that can track many employees and encourage employee accountability. These systems accurately track and manage work hours on tasks and projects, provide real-time activity recording along with each website and application used during working day, and arrange extra control by screenshots. All data collected in detailed reports and helps allocate resources and analyze productivity.

Time Tracking

Keeps track 🧐 of where your employees are

To have more control over where employees punch in and out from, using an employee GPS tracking system can help managers have a concrete understanding of where their employees are actually working. A GPS tracking system also allows employees who travel for work to make sure that they’re at the right place at the right time.

Prevents buddy-punching🧑🏼‍🤝‍🧑🏿

You can prevent buddy punching by implementing biometric fingerprint punching for your time tracking system, since it would ensure that only that particular person can clock in for themselves, and not anyone else. Buddy punching is the most common method of time theft, so preventing it plays a huge role in recovering lost time and money for a company.

Buddy Punching

Track ⌛ projects in detail

Detailed, task-based time punches are a great way to optimize employee productivity and show that they actually accomplished tasks during the allotted time. Not only does it keep employees on track, it increases the efficiency and organization of managing multiple projects at once.

This method also helps employers determine how much time is spent on a task to help better plan for future projects and assignments in a timely fashion.

Transparent reporting📑

Time tracking allows you and your team to be able to see everything and everyone that gets tracked. This encourages accountability amongst team members, and they’ll be more diligent in reporting time accurately so that the rest of the team can benefit from the time tracking information.

Fostering trust among employees and employers empowers everyone involved to focus on tasks that forward the company goal as opposed to facilitating administrative duties.

Streamlines 🗓️ scheduling and attendance

You’ll be able to streamline scheduling and quickly respond to time conflicts with a robust time tracking system. You can also keep attendance by monitoring employees’ arrival and departure times without being too intrusive. This way, employers can track time theft in the form of arriving late or leaving early from their scheduled shift.

If your employees want to swap shifts or get their shifts covered, this is also a great way to organize last-minute scheduling changes so everything is up to date.

While time theft may seem miniscule, it can add up quickly. Internal theft costs U.S. businesses up to $50 billion annually, of which time theft is a significant amount.

Accounting for time theft by implementing a secure time tracking system can prevent significant financial losses and increase employee morale by ensuring they are producing honest and genuine work while being as productive as possible.