The True Cost of Time Theft

The True Cost of Counterproductive Work Behavior: Time Theft

Have you ever had an employee clock in a few minutes early? Or maybe a few minutes late? Maybe they took a long lunch break and didn’t account for the extra time they weren’t in the office. Seems innocent enough, but the truth is, this counterproductive work behavior (CWB) is costing your company more than you think. In fact, time theft is one of the most widespread and preventable issues unreasonably costing companies across the country. Not only is it economically costly for organizations, but can affect the morale, productivity, and attitudes of employees as well. So before you let those minor time discrepancies slide, take a moment to consider the true cost of time theft.

What is CWB?

We all try to encourage positive, forward-thinking work, but what happens when employees’ goals and motivations don’t align with your organization’s? This is when counterproductive work behavior becomes an issue. CWB is any behavior that undermines the goals and interests of a business. It can present itself as an issue in a variety of forms including aggression, fraud, and harassment. However, we are going to focus on the alarming effects and costly statistics of employee time theft.

The Problem With Time Theft

As we mentioned, time theft has negative impacts on both your organization and on your employees. So it’s important to recognize the serious implications of time theft and implement actionable plans to prevent and avoid future violations.

So why is time theft so common if we know this counterproductive work behavior is so costly? Because employees can easily take advantage of inaccurate time tracking systems, making it difficult to properly track legitimate time entries. Manipulating paper timesheets and having other employees clock in on their behalf (also known as buddy punching), for example, are ways that employees can exploit the mismanagement of time and attendance. Additionally, if HR managers or supervisors were to try personally monitoring employee time and attendance more closely, it would mean spending their time inefficiently. Co-managing and “babysitting” employees clocking in and out is a task no HR manager wants nor has time to undertake.

How Time Theft Affects You

Time theft, or employees being paid for time they have not actually worked, affects almost 75% of U.S. businesses, according to a study conducted by the American Payroll Association (APA). Stealing company time may seem like a mild transgression, but this can cost companies up to seven percent of their gross annual payroll.

How Time Theft Affects Your Employees

In addition to being costly, time theft can further impact your company by diminishing employee productivity and morale.

This negative behavior impacts the quality of work produced by the employee engaging in time theft, but can also negatively affect the productivity of other employees in the company as well. If others see their efforts, work, and timeliness is not recognized and there is no consequence for time theft, some employees might be tempted to see how far they can push their boundaries as well.  When this counterproductive work behavior is perceived as acceptable behavior, it will spread like wildfire. Because what’s a few minutes here and there, right?

Likewise, creating a company culture in which time theft is common and lacks clear expectations can be extremely frustrating and demoralizing for employees. Seeing time theft go unnoticed by management can cause employees to feel distrust and dissatisfaction with their superiors and company.

Eliminating Time Theft

Organizations should take the time to evaluate their current time tracking procedures to identify leaks in their systems. Auditing their time and attendance systems and implementing an electronic or online solution can save HR managers time, companies money, and improve the bottom line. Eliminating the possibility of inaccurate time tracking and time theft with a cloud-based time tracking solution that syncs attendance data with payroll data will increase accountability for hours worked and ensure accurate pay.

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