Stop Employee Time Theft From Eating Away at Your Profits
Few employers will admit that time theft is an issue in their company.
“My employees wouldn’t do that,” or, “I have systems in place to prevent that type of thing” many employers might think. But the fact is that time theft is real –and more common than you may realize. It’s estimated that 43 percent of hourly paid employees round up their weekly work hours. And according to the American Payroll Association (APA), time theft is something that nearly 75 percent of U.S. businesses are impacted by.
Lest you think that simply tacking on a few minutes here and there isn’t too significant, these minutes can add up considerably over time. In fact, time theft is something that can cost companies up to 7 percent of their gross annual payroll.
The implications of time theft can be serious –not only can exaggerated hours add up considerably, and eat into your company’s profits –but when left unchecked, time theft can also cause stress among your workers –and have a negative impact on your company culture.
If you have employees, it’s important to be aware of the implications of time theft. Here’s what it means to your company, and how you can combat it to prevent it from happening to you.
What Time Theft Looks Like
Time theft might not look like much, a few minutes here a few minutes there –but it all adds up, and in the end, you will be left paying for more hours than your employees have worked. Time theft comes in different forms, here are a few:
- Time Clock Theft
Time clock theft happens when workers clock in, but don’t start working right away. It can also occur when they falsify their timecard data, showing that they arrived on time when they were actually late. It can also happen when workers overestimate the amount of time that they spent on a project. No matter what form it takes, time clock theft can add up considerably over time.
- Excess Personal Time
Another area where time theft can occur is the overuse of personal time. Time that’s spent checking email, making phone calls, and surfing the web can quickly add up –or leave a bad impression to customers who may be ignored by workers who are distracted with their phones.
- Covering for Coworkers
One of the more blatant forms of time theft is clocking in for a coworker. Sometimes employees will ask a colleague to cover for them, and sign them in if they’re running late. This can cause employees who are asked to cover for their coworkers to feel frustrated, and pressured into doing something that they don’t feel right about.
How Much Does It Cost?
So just how much does time theft cost your company?
It’s been estimated that the average employee steals approximately 54 minutes a day, or 4.5 hours per week. This totals nearly six workweeks per year. If you’re concerned about paying out for time that isn’t worked, then time theft is an issue that should be taken seriously.
How to Prevent It
Preventing time theft is important. If you want your business to succeed and wish to keep turning a profit then you should put measures in place to prevent it from happening. Here are a few ways that you can put an end to time theft in your business today.
- Keep Them Honest
Having security cameras that can watch your employees, clocking in and out, can help to discourage your team from clocking in their coworkers. It will also help to keep your employees from spending too much time on personal business, or running side projects while on the job.
- Explain the Consequences
Bringing up the consequences of time theft in meetings from time to time will help your employees to recognize that you take time theft seriously. This may help to discourage them from falsifying data, and will make them think twice before adding a few minutes here and there.
- Time Tracking Software
A current, up-to-date, time tracking system is the best defense against time theft. This will make it harder for employees to falsify or exaggerate their hours, or to clock a coworker in. Choosing a program that has webcam or smartphone verification will enhance security even more. Time tracking software ensures that everyone is on the same page, helps to encourage honesty, and saves you from having to be the bad guy.
While time theft is a common occurrence in many companies today, that doesn’t mean that you have to tolerate it. By taking action to help keep your team accountable, you will be able to help reduce the instances of time theft that occur in your company –and ensure that you’re not paying out for time that isn’t worked.
