4 Best Practices to Prevent Employee Time Theft

Time theft cuts across more than just physical misapplication as it remains a silent participant in the incompetence of workplaces. Time theft involves a situation in which employees are not working and getting paid ultimately pretending that they are doing their job. It is a quiet killer to identify.

Employees can divert from their work duties or even clock hours they have not covered resulting in wasted resources, and thus reduced production. It can be difficult to detect and tackle such cases. The knowledge of peculiarities relating to time theft is essential. It includes a number of aspects – from unsanctioned clock-ins to overlong breaks and digital distractions. It is, therefore, important to detect these cases, rectify them, as well as prevent them from taking place further without victimizing the employees unnecessarily.

Addressing time theft requires a complex strategy revolving around technology, policy enforcement, and nurturing a culture based on a positive work environment. Through promoting transparency, adopting strong guidelines, and tackling root courses, companies are able to limit the adverse influence of time theft on their business. Let’s discuss this in detail.

What is Time Theft?

Employee theft can be anything from some fake discount to family and friends while making purchases or taking a few office items from the inventory. Time theft is one type of stealing that you may not include in your calculations. It happens that employees are absent when supposed to be present or do less during their presence.

Fraudulent as time theft may be, it is very difficult to demonstrate. According to FLSA (Fair Labor Standard Act), you may not withhold wages (also called wage theft) from employees. If you counter the claim of withholding wages by an employee with a time theft, it will be considered retaliatory. Rather than filing charges against your workers, it is worth investing in preventing time theft.

How Do Employees Commit Time Theft?

A group of people working in a manufacturing unit of a factory.

One should note that – time thefts of employees usually occur due to a lack of motivation or by accident.

1. Disappearing on the Job

For work environments with outdoor work sites such as yards, areas of recreation, or even big offices, employees may disappear without informing their supervisors. This could hinder operational efficiency. If you suspect some of these people of stealing time, it’s possible to keep them close and measure their productivity.

Remote work is an aspect that has skyrocketed since the pandemic. There are numerous distractions associated with remote work, such as running errands or doing house chores activities. To help control this, you can carry out impromptu check-in video conferences to verify that indeed they are at their workstation.

2. Unauthorized Clocking In and Out

“Buddy-punching may seem harmless, but it erodes the foundation of accountability and honesty in the workplace. It’s not just a time theft; but a breach of trust and integrity.”

A quote by OpenTimeClock.com.

To cheat the attendance system in their absence, employees may use “buddy-punching” where fellow workers punch in and out on behalf of an employee. According to the American Payroll Association, more than 75% of businesses lose money due to buddy-punching. Employ software programs that have time clock functions, which also allow time-out requests and missed hours to motivate employees to truthfully enter their working hours. Facial recognition is also included in some applications to avoid time fraud.

3. Sleeping on the Job

Sleeping whilst on duty may lead to loss of productivity and create unsafe working conditions, which increases the rate of hazards for accidents. Nevertheless, this is something that generally occurs due to having an overwhelming workload. According to the U.S. Bureau of Labor Statistics, a full-time worker has work sessions that exceed 40 hours in one week and considers average daily duty time as an estimated lengthened stay based on additional requisites such as other undertakings beyond his reach like family or societal matters. The situation is likely to be intensified by working hours at night, overtime, and long shifts. Think about talking to these employees individually to discuss possible solutions.

4. Rounding Time Up

Many time and attendance software apps also automatically round up all logged hours to the nearest 15 minutes (or in 3-minute increments in some cases). So, employees may stall before clocking out to round up their time. The U.S. Department of Labor permits rounding adjustments to be made to counteract unfair practices based on distorted time sheets. However, it has got to be a middle-of-the-road or honest adjustment toward the closest increment and not one thing that’s completely in the employer’s favor.

A group of people sitting around a table looking at a laptop.

5. Work on Computers Distractions and Using Mobile Phones

Employee work often requires working on a laptop or desktop computer, but employees can go outside their authorized usage by:

  • Reading news.
  • Shopping online.
  • Scrolling through social media.
  • Handling personal matters, such as paying the bills.

An organization-wide restriction can be made on outside web pages that reduce computer misuse. The internet and mobile phones are major distraction sources. If an employee is too consumed with the phone, it means that there is a decrease in productivity. Employees are also distracted by lengthy phone calls, games on their handsets, and social media sites from which they do a lot of texting. This is especially evident in situations where workers are operating independently or without close supervision by management, for instance at small retail outlets like convenience stores and petrol stations.

6. Extended Lunch Breaks, Excessive Smoke Breaks, and More

During the lunch breaks, employees are normally given 30 minutes or 1 hour, and sometimes these time frames may go way beyond the usual break period. Nevertheless, if it comes to be a recurring offense, action can affect productivity in many ways, for instance failing to attend meetings or submitting projects on time. The employee break regulations need to be re-investigated so that there can be enough time allowed for breaks. Include extended lunchtime or flexible hours in order to reduce efficiency issues from the total effect.

Many employers do not mind smoke breaks and even provide smoking zones in the workplace. However, it should be noted that if employees spend a significant portion of their shifts taking longer lunch breaks for smoking or vaping and return too late from the break period – this contributes much more significantly toward time theft. A company policy should be put in place stating when smoke breaks are free and on the clock.

Negative Consequences for Your Business

One of the glaring problems caused by time theft is reduced productivity. However, it has the power to influence your company culture by creating a domino effect on others putting in their time, and might see this as demotivation. This can be very demoralizing for everyone involved, leading to low productivity. It even results in general dissatisfaction with jobs, high rates of turnover, and difficulty in retaining top performers.

Monetarily, businesses incur tremendous losses amounting to more than $50 billion through time theft which forms the basis for over 35% of bankruptcies. This leads to you paying employees for hours they never served.

Key Practices to Prevent Employee Time Theft

Three people working on a computer in an office.

1. Use a Time Clock Software

Using time clock software in your organization helps with effective attendance and time management for the employees. It can contribute to increased accuracy of payroll and bring productivity in quality standards. Let’s go over some time clock features:

  • Facial recognition: It is a biometric time clock and an advanced tool for tracking employee times that use the employee’s face to either check in or check out.
  • Barcode, RFID, and QR code: An employee’s ID gets printed out to a badge card encoded either in the form of a barcode or QR code to authenticate with an external scanner or with a scanner connected via a computer.
  • GPS and Google Maps: They assist you in tracking the geolocation of an employee and can even see the clock in or out locations through Google Maps.
  • Job tracking: The employee’s work hours at each job can be traced.
  • Web camera photo stamp: This permits a picture of an employee to be taken and retained for evaluation by the manager.
  • Shift and schedule: It enables you to verify who leaves early or late from the approved period.

To select the correct time clock software, evaluate why your company requires one. For instance, if you wish to develop it for accountability then go for software that accurately does the identifications with assistance from biometric features. Think about their components too. For example, automated accruals of paid days off or the possibility of filing requests on missed hours and shift absences.

The reporting features should have a wide range of options that will ensure you can analyze the data. Understanding the data is very crucial for accurate time tracking. The interface is very vital. It should be user-friendly, and easy to learn and navigate, while its installation process should be seamless.

2. Build Employee Morale and Be Flexible and Understanding

Time theft is an apparent manifestation of poor performance and morale. However, by creating a high employee spirit, this problem can significantly be reduced. Consider:

  • Training your employees for professional development.
  • Listening to their problems.
  • Encouraging genuine breaks.
  • Streamlining work based on skills.
  • Giving employees more paid time off.
  • Be transparent and open about communications.
  • Pay fair wages.
  • Actively listen to employee input.
  • Incentives for your staff, such as bonuses.
  • Recognize and reward your employees.
A group of people giving each other high fives in an office.

80% of workers prefer jobs with flexible schedules. It can:

  • Reduce burnout.
  • Reduce stress.
  • Reduce turnover.
  • Sustain a healthy work culture.
  • Increase morale and motivation.

In case you have employees working remotely, flexible timings would help to avoid time theft. They can take a little break time from work to take care of their children or even finish some chores while still having done the daily required hours.

3. Hold Regular Meetings and Check-in Regularly

Conducting meetings at regular intervals with employees can help tackle time theft without blaming anybody. It is important to check the temperature with your employees so that you can understand how they are feeling and even their intention to steal time – burnout, financial stress, etc. On the part of those who work remotely, checking in will reduce loneliness and isolation.

4. Establish Clear Time and Attendance Policies

You can reduce time theft by including clear timekeeping policies. Your time and attendance policies should consist of:

  • Time for a break.
  • Overtime rules.
  • Flexible work arrangements.
  • Internet or technology usage.
  • Timing procedures for clocking in and out.
  • If socializing during company time is acceptable.
  • Time theft and its consequences.
  • Attendance and time tracking methods you intend to use.
  • Impact of time theft on both employees and the business.
  • Consequences of violations, which should include repercussions of time theft, such as warnings, terminations, or disciplinary actions.


Best Practices to Prevent Employee Time Theft: Endnote.

Time theft can only be properly addressed when vigilance and empathy combine as two aspects of a delicate balance. Apart from the financial losses involved, it feels the ripple of time theft in employee morale and overall organizational culture.

In conclusion, setting clear rules on time management in businesses using technology and putting employee well-being first are vital measures to ensure a reduction of negative implications associated with time theft. In the long run, though, it is a proactive aspect that values fair practices while addressing the root causes creating stronger and more efficient human resources to protect businesses from the silent killer ‘time theft’.

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Published By: Souvik Banerjee

Souvik BanerjeeWeb Developer & SEO Specialist with 15+ years of experience in Open Source Web Development specialized in Joomla & WordPress development. He is also the moderator of this blog "RS Web Solutions".