Remote work is not new, but for many organisations, the pandemic was their first time implementing this style of work. It seemed challenging at first, but for those who got it right, it brought tremendous benefits.
Of course, working from home has its drawbacks. Distractions and interruptions are everywhere, and this affects productivity. But one of the biggest challenges to optimising employee time continues to be time theft.
Consider this: The average employee steals approximately 4.5 hours per week from their employer, according to a Forbes article. This accumulates to around six full workweeks every year. In terms of cost, a whopping $400 billion annually is lost in productivity.
What Is Time Theft?
Employee time theft is when an employee is paid for the time they didn’t spend working. The employee could be engaging in personal activities but intentionally misleads their employer about how they spend their time. In other cases, the employee could be doing nothing at all, but still receives payment for their time.
For office workers, it’s easier for the employer to notice, and even monitor, time theft. If a worker takes a longer lunch break or is making rounds of socialising rather than working at their desks, it is highly visible.
When managing a remote team, it’s far more difficult to monitor time theft since employees are invisible. You can’t really tell if the employee is watching their favourite show or scrolling through social media on their phones.
Most employers pay their workers based on the number of hours they spend working. When employees steal time, it means the company spends money it wasn’t supposed to. This could have serious consequences on productivity and the company’s overall performance.
Examples of Employee Time Theft
Employee time theft can happen in so many ways, and sometimes it’s not that obvious. Below, we list some of the common ways employees claim wages without earning them:
- Taking longer than necessary breaks. The U.S. Department of Labor lists the laws pertaining to lunch and break for each state. It’s healthy and even productive for workers to take breaks throughout the workday. But when an employee spends more time than the stipulated break period, it becomes time theft.
- Buddy punching. This is common among office workers, where an employee asks their buddies to fill in timesheets on their behalf.
- Socialising during work. Light socialising between breaks or after meetings isn’t a bad thing, and might actually help your teams build relationships. It stops being productive the moment the light conversation goes on for the next 30 minutes. Unless, of course, the business requires socialising with clients to help build trust and rapport to help win their loyalty.
- Timesheet fraud. This happens when an employee alters or forges timesheets to get paid for extra hours. While this might happen unintentionally, especially with manual timesheets, which are prone to errors, it can be quite costly for employers. Take an example of a team member who clocks into work late and clocks out too early. Starting work at 8.05 am instead of 8.00 am or clocking out at 5.50 pm instead of 6 pm might not seem like much. But these round-ups and down can add up to a huge chunk of hours over time.
- Clocking unauthorised overtime. The Fair Labor Standards Act requires that you pay overtime for hours worked over 40 per workweek. What if an employee works more than 40 hours per week, despite clearly asking them to stop at 40 hours? Unfortunately, you may still be required to pay anyway. For a repeat offender who refuses to comply, termination might be your best course of action.
How To Stop Time Theft
Time theft is a common remote work challenge that a lot of business owners or managers are trying to curb. If you’re one of them, this guide shares the best strategies to stop time theft.
Develop Clear Time and Attendance Policies
A company with clear timekeeping policies has a better chance of eliminating employee time theft. If you don’t have a policy in place, it’s not too late to establish one now. Your time and attendance policies should be clear on:
- Procedures for clocking in and out
- Break times
- Overtime rules
- Personal use of the internet and technology
- Acceptable socialising during company time
- What counts and doesn’t count as time theft
Your policy should also outline:
- How time theft can hurt the business and coworkers
- The consequences of time theft
- Attendance and time tracking methods you plan to use
- How employees can protect themselves from falling into bad habits
Defining clearly what you expect from employees eliminates any gaps that may result in legal action in case of wrongful termination. It also helps your virtual team understand what’s right and wrong.
Be sure to give employees a chance to ask questions and provide feedback to address any issues. Get these rules in writing and make them accessible to all employees. Cloud services like Google Drive and OneDrive make it easy to share the policies with employees no matter their location.
Implement Time Tracking Software
An effective way to eliminate employee time theft is through technology. Modern time tracking solutions offer features that make it easy to tell if someone is at their computer or in a meeting. You can even see their exact location if they work out in the field.
Most of them are automated, meaning you don’t have to spend time manually entering data or correcting errors. These tools accurately log hours spent on each project or task, and even indicate how the time was spent.
For example, you can see all the apps and websites the employee accessed during work hours. If you discover an excessive amount of time spent on social media and other non-work-related staff, you can address the issue before it blows over.
Using clock in clock out apps also solves the mystery of employee attendance since they capture computer activity, which employees can’t cheat. Most importantly, these tools provide you with crucial data that can help you learn a lot about your employees and the business.
An effective time tracking solution offers payroll features, so you can access accurate, automated timesheets and create invoices directly from the platform.
Look Out for Signs of Disengagement
For the most part, when employees are committing time fraud or are struggling with work, there are always telltale signs. For example, if the employee delays responding to a work email or fail to answer calls, it might seem suspicious.
But this isn’t proof enough of time theft. If the worker constantly sends in assignments late or is notably unavailable compared to coworkers, it could be a sign of disengagement.
Mistakes happen, but when they are repeated, you can start investigating the matter.
Additionally, working in isolation can lead to disengagement, which can result in employees committing time fraud. Managers should remind their remote workers of the overall company goals and mission, as well as their personal goals.
They should also support them through the challenges and help them focus on work. Don’t forget to reward excellent work. A simple shout-out via the team’s official communication channel can do wonders for an employee’s morale.
Knowing what’s going on with your employees can help you understand how they are feeling. Your remote workers may be juggling several responsibilities at home with work. They could be stressed about finances, or they could be burned out.
By checking on them, you get the chance to listen to their concerns and learn about their wellbeing. Asking about their days also reminds them that they are not alone, given that remote workers struggle with feeling lonely and isolated.
Be Flexible and Understanding
The typical 9-5 schedule may not be ideal when employees are working remotely. Offering them flexible hours can help reduce cases of time theft since they’ll have time to go to appointments, take care of their children and pets, and run errands.
A recent survey published by PR Newswire shows that 80 percent of workers would prefer a job that offers a flexible work schedule over one that didn’t, for good reason. Scientific research proves that flexible working hours contribute to the health and wellbeing of employees.
Allowing employees to customise their schedules to some extent can reduce wasted work time and improve productivity.
Follow Through with Disciplinary Actions
You must show that you take the time theft offence seriously by disciplining offenders as per the disciplinary measures outlined in the time and attendance policy. Generally, this could include verbal warning, written warning, suspension, and termination.
For example, if one of the rules for manipulating timesheets is pay cut, be sure to cut one day’s salary from the offender’s salary. This way, not only will other workers take the time theft policy more seriously, it will lower cases of time fraud in the company.
Knowing the facts about time theft will help you take the right steps toward eliminating it from your organisation. In everything you do, make sure you maintain an open line of communication. This way, employees will know you’re approachable and willing to listen to their concerns.
Most importantly, develop remote work policies that clearly outline employees’ expectations, including timekeeping and warnings about time theft and its repercussions.
Go On, Tell Us What You Think!
Did we miss something? Come on! Tell us what you think about our article on managing time theft in the comments section.
A startup consultant, digital marketer, traveller, and philomath. Aashish has worked with over 20 startups and successfully helped them ideate, raise money, and succeed. When not working, he can be found hiking, camping, and stargazing.