Shocking news from the American Payroll Association and Robert Half International indicate that employers lose up to 4.5 hours per week per employee due to rounding, buddy punching and time theft. One recent study estimated that US employers lose more than $400 billion per year in lost productivity due to time theft. The longer rounding, buddy punching and other forms of time theft can grow unchecked, it becomes increasingly difficult to stop without a complete system change.
Outdated time and attendance methods like manual time sheets, unverifiable time clocks and badged punch in/out are part of the problem not the solution. Where owners and senior managers refuse to install the available technology to solve the problem, middle managers and supervisors become ambivalent. The result is that three-quarters of the time thieves will never be caught and lost productivity and unearned wages continue.
Don’t be “penny-wise and pound-foolish” – the investment in converting to effective time and attendance technology is negligible in light of the risk. Cloud-based time and attendance systems enable employees to punch in/out and be verified by finger print or facial recognition in real time on any device. GPS will track where they punch in/out. These systems will also track when an employee is about to run into overtime, as well as who is on PTO, who is working on what job at which location and what expenses and mileage should be charged against which job/location, which facilitates labor distribution and job costing – a way to recover some of your losses.
With powerful, easy to use time and attendance technology solutions so readily available, there is no excuse for small businesses to enable Time Theft with outdated and ineffectual time and attendance practices.
74% of employers have payroll losses due to “Buddy Punching”
2.2% of gross payroll is the estimated cost of buddy punching, just one type of Time Theft.
$400 Billion per year in lost productivity due to Time Theft.
75% of time theft will never be caught.
The material presented here is educational in nature and is not intended to be, nor should be relied upon, as legal or financial advice. Please consult with an attorney or financial professional for advice.