Business Tips

How to spot construction employee time theft

Employee time theft: how to spot it, what to do about it

Your employee theft is costing your thousands every year.

Think you don’t have a theft issue? You probably do.

This type of theft isn’t easily seen or uncovered by employers because it happens minutes at a time. And if you are using paper time card or some other manual, time-consuming way of tracking your employee’s time, you are probably missing these quick cheats.

Just ask Laurie Saul Inglis of Advantage Flooring in Maryland. “I had about 20 guys turning in timesheets at different times, and most would turn them in late,” she told us. “Those on the same jobs copied off of each other, but I couldn’t do anything about it.”

So what exactly is time theft?

Time theft is when an employee either bills you or misrepresents their work hours when they didn’t actually work. This includes clocking in when they aren’t even on the jobsite or clocking out late saying they were working when, in fact, they were horsing around. Sometimes thieves even leave a jobsite and have a friend “buddy punch” for them — clocking them out of the job when they’ve actually been gone for hours.

Here are a few other ways you could be being cheated:

  • Time sheet fraud (putting in days or hours worked when they weren’t present)
  • Late starts (ten minutes here and there adds up!)
  • Early finishes
  • Long breaks
  • Slowing down the pace of work to create overtime
  • Performing personal activities at work
  • Buddy punching

How much is time theft costing you?

A study published by the American Payroll Association (APA) reported that buddy punching was widespread, with more than 75 per cent of companies losing money from this practice. That adds up. According to the APA, the costs actually average around seven per cent of your total gross payroll. (Are you doing the math on that?)

What can you do about it?

Implement smart technology (and ditch the paper-based processes). From electronic job clocks on the jobsite, to cloud-based SaaS software for mobile or on- site electronic punch in and out capabilities, field innovations like these are making time theft obsolete.

SaaS (Software as a Service) time management solutions utilize mobile apps to track employee’s time, putting virtual time clocks on the jobsite via tablets and smartphones. Some solutions even offer biometrics, automatic clock-in and clock-out image capture (to prevent buddy punching), and geofencing, which provides a virtual fence around your jobsite that shows you where your employees are located when they clock-in or clock-out of your jobsite. Plus, cloud-based time management solutions “plug in” to payroll software like Quickbooks, automatically uploading your employee timecard data into your payroll system, saving your accounting teams hours (and even days) of work.

These solutions may cost you upfront, but they’ll save you tons in the long run. Laurie’s company shifted to a time-savings time management software and reaped the rewards saving about $75,000 a year in time card fraud. Plus, she’s no longer having to address timecard issues with employees, giving her relief from tough conversations.