The true cost of time theft in the workplace
Time theft is a significant drain across virtually all industries and workplaces. It can be a significant but silent cost to the business. IT can hard to identify and even harder to prevent. The costs when employees are stealing time, other than the obvious financial cost, include the inability to expand the business, low morale, negative impacts on customers, and even forcing the business into liquidation.
Statistics from the Australian Federal Police reveal workplace theft costs Australian businesses as much as $1.5 billion every year. Protecting the company from this loss is just as important as growing sales and finding new customers.
Types of time theft
Time theft in the workplace can take many forms and has several causes, including:
- Completing personal activities on work time (for example, workers who are ‘mobile’ such as drivers stopping to visit the post office, or get coffee on during work hours)
- Buddy punching, where employees clock in for each other. This is common in workplaces that use manual ‘Bundy clock’ systems, rather than modernised scheduling and payroll software platforms.
- Taking long breaks
- Starting late/finishing early
- Logging unauthorised overtime, such as rounding up timesheet hours
- Poor roster oversight. Companies still using paper rostering can easily lose track of who is supposed to be working, and when. Digital HR solutions that integrate leave management and scheduling and that offer cloud-based monitoring make employee rostering more transparent.
Taking action on time theft
Even when time theft is identified in the business, it can be hard to stamp out. If a culture has been allowed to grow amongst employees, there will be no quick solution. Onboarding new employees is a critical moment in the tenure of employees to establish expectations. This includes setting boundaries for what is acceptable practice, avenues for employees to raise rostering and scheduling queries with managers and giving clear guidance on consequences for breaches of policy, such as time theft.
In extreme cases, a business may need to terminate employees for time theft. In 2009, the Small Business Fair Dismissal Code came into place and applies to Australian businesses with fewer than 15 employees. The Code provides procedural guidelines for dealing with serious misconduct. Time theft is regarded as theft, in the same way as stealing stock or money. As such, the business may have grounds for instant dismissal, (using the Code’s checklist as a guide).
However, in most cases a discussion with the employee may be the best route to take. This can help build trust between the employee and the business, as well as helping the business identify any root causes of systemic time theft occurring across the company. This gives the employee the chance to improve and set and example to other staff. For the business, this may help shape policy and practice that actually benefits the business. For example, staff may be ‘wasting time’ when it is quiet because they are not sure what the business wants them to do. Providing specific and manageable tasks during quieter times, (e.g. when we have no appointments, we are following up pipeline sales leads) gives guidance that may have been lacking.
Minimizing time theft as part of the business workflow
While measures such as terminating employees may be necessary in some instances of time theft, it important the business does not just react when a problem is identified. There are several steps the company can take to minimise time theft and boost productivity. This includes making changes for both the business and employees.
For employees, it is important to highlight the benefit every employee has to the business. Change the culture to show every employee how, as a coherent team, they are more than the sum of the team’s parts. This forms a culture of interdependence and can boost morale and productivity. Every individual will see the time they contribute as important, and are less likely to “steal” it through time theft.
For the business, the implementation of all-in-one intelligent HR software can have a transformative impact on managing time theft in the workplace. A digital HR system can allow you to optimise scheduling, especially where part of the workforce is casual. The best software provides live reporting, putting access to real-time data on roster performance, workforce performance, productivity levels and cost of labour at your fingertips. The business can dynamically adjust scheduling and payroll, with cloud-based self-service for both employees and managers. This minimises downtime for employees and consequently, wasted time for the business.
The ability to track staff performance using live dashboard reporting assesses data in real-time, giving managers a measurable, tangible metric.
The best digital HR solutions also allow for customised inductions and paperless onboarding, providing new starters with the information they need before their first shift using the delivery route of your choosing. This establishes time and attendance expectations before commencement, allowing for a smooth start to the job.
Don’t let time theft be the silent profit killer in your business.