While the occasional extended coffee break or early quitting time may seem harmless, rampant abuse of company time can inflict major harm on the health of your bottom line. If you aren't keeping close tabs on employee time, you may be subjecting your company to significant financial losses. Employees have figured out every which way to Sunday to try and beat the system.
1. Timesheet Fraud
If you are using timesheets to record employee hours, you may be subjecting your company to significant payroll fraud. Time sheets are like a blank check - inviting employees to fudge their time by filling out extra hours they didn't actually work or round up minutes to increase their compensation. Time clocks and automated software-based time clock systems are your first line of defense against time sheet fraud.
Time clocks accurately record start and stop times an employee works down to the exact minute. Auto totaling time clocks and automated software-based time and attendance systems automatically calculate total worked hours per pay period.
2. Buddy Punching
Buddy punching is when an employee asks a co-worker to punch the time clock for them if they are late or absent from work. The problem is worse for employers that track time on paper time sheets. Biometric time clocks quickly scan employee fingertips to positively identify and then register arrival times, breaks, lunches, overtime and departure times.
Fingertip scans are stored and assigned to each employee using time and attendance software. Each unique finger scan provides indisputable identification and prevents "buddy punching" time theft.
3. Extended Breaks, Late Arrivals and Early Departures
Break abuse, late arrivals and early departures are the most common form of time theft, costing employers thousands of dollars each year. When an employee arrives late, takes longer or more frequent breaks, takes extended lunch breaks, or leaves early, it all adds up to a bunch of money. According to the American Payroll Association, the average employee "steals" 4 hours and 5 minutes every week, or 6 weeks annually. For a worker making $10 an hour, that equates to $2,340 a year of lost time and company money! Using a time clock or automated time clock system can help watchdog check-in/check-out times with greater a accuracy, and eliminate costly overpayments.
Implementing a time and attendance system also lets employees know that they are being monitored and curbs them from taking long breaks and leaving early. Time clocks provide an official record of the hours an employee works to calculate the actual pay owed to an employee.
4. Down Time
Employees may be tempted by a number of distractions during the workday, which may take them away from their work and lower productivity. These include:
- Excessive socializing
- Personal phone calls
- Stepping out of the office
- Sleeping on the job (yes, you read right! 29% of workers report falling asleep on the job, based on a National Sleep Foundation survey) [i]
5. The Internet Trap
The internet can be a real employee time sucker, cutting into work hours and slowing productivity. Social media is a growing concern for time theft. According to a study by Nucleus Research, productivity plummets by 1.5% when staff can access Facebook in the workplace. 61% of employees surveyed, use the site at work for 15 minutes per day. Here's how some employees are spending their time:
- Checking personal email
- Shopping online
- Gaming online
- Surfing social media
6. Ghost Employees
The most blatant form of time theft are ghost employees. This type occurs when an employee punches in, leaves the workplace without performing any work, then returns to work at the end of the day to punch out. Another form of ghost employees occurs when when management creates fictitious employees, puts them on the payroll, logs them into work each day, then embezzles the fake employees' paycheck.
7. On the Move
Mobile workforces have their own set of challenges, as it may be difficult to pinpoint if the employee is where they are supposed to be. Drivers, landscapers, and home health aides, for example, may make personal stops at the store, or go home to let the dog out, or may not even show up for work at all. Without checks and balances, these types of employees can disappear off the radar.