Time theft costs $11B annually.

Here’s how you can put a stop to it for good.

Originally Published on TSheets by Quickbooks on Kim Harris

It’s not fun to think about, but employee time theft and buddy punching are more common than we’d like to admit. We did the legwork to get to the bottom of these costly issues, and the results were shocking: US businesses lose billions annually. But, rest assured, there are ways to prevent these types of situations — or, at least, make them less common.

The time theft problem

First of all, what is time theft? Time theft happens when an employee is paid for minutes or hours they did not work by accidentally padding their timesheets or simply rounding their time at the beginning or end of a scheduled shift.

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Whatever the circumstances may be, this behavior inevitably leads to more expensive payroll costs. Our research found half of US employees admit to adding between 15 minutes and an hour to their timesheets!

It might not seem like a lot, but compounded over time, those little minutes really add up. To put this into perspective, an extra 15 minutes on half of America’s weekly timesheets could add up to $11 billion dollars in unworked hours.

And then, of course, there are the outrageous cases. In September 2017, a nurse in Florida was arrested for falsifying 35 timesheets over the course of three months, amounting to a total of $5,900 in wages she didn’t earn. 

Buddy punching is extremely common

Buddy punching is so common, you’ve probably done it once or twice in your life. Buddy punching happens when one employee clocks in for another (their “buddy”) to ensure they have a certain number of hours on their time card or aren’t dinged for being late or absent from work.

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Employees who clock in using old-school punch clocks or paper timesheets have an especially easy time buddy punching. But even with high-tech systems, it’s too easy for employees to share their PINs and passwords.

A recent TSheets survey of 1,000 hourly employees found 16 percent of workers admit to punching in on behalf of a fellow employee. You’ve heard the stories before: One employee is running late but wants to appear punctual nonetheless. Or someone clocks in their friend so that employee can reach their required hours for that week or pay period.

For the most part, it’s ok to believe employees are well-intentioned, honest, and simply want to do their best work. But regardless of intention, at the end of the day, friends helping friends fudge timesheets is still time theft. And it’s against the law. So how can employers prevent those extra minutes from impacting their bottom line? 

3 ways employers can ensure their teams are accurately tracking time:

  1. Include a time theft policy in your employee handbook. Let your employees know you have a no-tolerance policy against time theft and buddy punching. Have an open conversation, put it in writing, and help your employees understand time tracking best practices.
  2. Implement time tracking software with photo capture or biometrics. Say cheese! When your employees clock in and out, tools like the TSheets Time Clock Kiosk take their photo. Admins can then review those photos on the back-end before they approve timesheets for payroll. Plus, TSheets’ facial recognition feature notifies admins if any employee doesn’t look like whoever clocked in.
  3. Try location-aware technology. Employee tracking apps with location-aware technology allow your employees to clock in and out with their smartphones (something they’re not to give out to their coworkers). Plus, GPS technology helps you see where employees are when they clock in and out.

Your employees won’t likely try anything as fraudulent as stealing thousands of dollars from you in a few weeks, but time theft and buddy punching shouldn’t go unchecked. It’s important to have the systems and tools in place so employees feel empowered to make the right decisions when it comes to tracking their time.


Fuse Financial Partners is here to help you take action on these and many other important business initiatives.  Watch our video for a brief understanding of all the ways FUSE can help your business find that spark!

Ready to talk? Sign up to have a conversation about your business’ potential, with one of our experienced CFO-level advisors.


Originally Published

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