What exactly is time theft and how much is it costing your business?
Time theft is one of the most overlooked issues costing businesses more money than they probably know. It’s also one of the most preventable problems that businesses face.
What is Time Theft?
Time theft is when an employee accepts pay for time they have not actually put into their work. From fudging time sheets to using work time for play time—whenever employees are on the clock but not on the job, they’re stealing time. Time theft can be hard to detect. It comes in many forms and many levels of severity. Employers pay the price via inflated payroll and lost productivity.
What is the Cost of Time Theft for Business?
While it’s hard to get a handle on the losses caused by time theft, one study estimates that it costs U.S. employers more than $400 billion per year in lost productivity.“>[i] 10 and 15 minutes here and there add up to big losses over time.
Furthermore, 74% of employers experience payroll losses related to buddy punching (when one employee punches in for another). According to Nucleus Research, these losses average 2.2% of gross payroll, and that’s just one form of time theft. [ii]
What Is Time Theft Costing You?
Consider this: The average employee steals 4 hours and 5 minutes every week according to the American Payroll Association.[iii] It’s shocking, but it’s also consistent with a seminal time theft survey conducted by Robert Half International, which found that employers lose about 4.5 hours per week per employee.[iv]
In fact, three out of four employees will steal something—products, intellectual property, work time, you name it—from their employers, according to a study by the U.S. Chamber of Commerce.[v] The study concluded that U.S. employers lost $20-$40 billion as a result of employee theft in 2012. And that 75% of the thieves will never be caught.
Keeping These Employee Time Theft Stats and Facts in Mind
While every employer has to deal with time theft, it’s especially challenging for companies with a distributed workforce. So, even if you hire carefully and manage scrupulously, chances are you have some percentage of workforce theft in your midst, and that likely includes time theft.
Knowing the facts about time theft, it’s important to take the right steps toward eliminating it from your company. There are many ways to do so, especially with the help of EPAY Systems’ innovative solutions, which can help you prevent CWB to further improve your bottom line, save time in HR management, and ultimately save money.
Time theft got you worried? Don’t sweat it, EPAY Systems’ best of breed time and attendance system can help you crack down on time thieves. Our mobile solution with GPS tracking and biometric time clocks make buddy punching and time theft obsolete. Contact us to learn more about how we can help you prevent employee time theft.
[i] The Kentucky CPA Journal, Fall, 2007, “Biting the Hand that Feeds: The Employee Theft Epidemic” by Terrance Daryl Shulman, JD, LMSW, ACSW, CAC, CPC