Time theft occurs when employees get paid for work that they did not do—for example, taking wages for a 40-hour work week but only working 35 hours. It includes arriving late and leaving late, leaving work early and failing to pay adequate attention to tasks. Spending time reading personal messages or scrolling through social media takes away from the time to do assigned tasks.
There are also cases where employees work together to cheat the system. This includes creating false timecards. This also involves supervisors allowing workers to leave early without taking leave. Plus, employees also go as far as to lie about even being at work, and some coworkers are willing to turn a blind eye or even cover for them.
The consequence of time theft
Time theft can cause nonprofits severe losses, including decreased productivity since only a few hours are spent on tasks. This means a lot of tasks will go unfinished, making the company unable to meet deadlines. It also costs nonprofits significant financial loss. According to EPAY Systems, time theft causes employers to pay over $400 billion in lost productivity each year. The American Payroll Association (APA) reports that roughly 75% of US businesses are affected by time theft.
How does the board ensure that time theft is not occurring in the nonprofit?
The board can discipline employees by giving them a warning to permanently terminating them. While time theft is usually handled as a civil matter, employers can sue employees to recover any losses the company suffered. According to Attorney Neil Pederson, “If you have intentionally submitted falsified time records to get more money than you were entitled to receive from your employer, you have committed a theft crime. You could be criminally charged for that”.
Nonprofits can implement strategies that allow them to keep an eye on employees. This includes having check-in and check-out sessions to see if all employees are present and working on their respective tasks. They can also utilize surveillance cameras and better monitor staff.
Improve work environment
Employees are often guilty of engaging in time theft out of spite for the organization. By creating a working environment with more pleasant policies, employees will become more supportive and less petty.
Overall, time theft can be detrimental to business since it can cause a loss in productivity. Employees should be educated on what it is exactly and how and why they should avoid it. Finally, time and attendance policies should be clearly defined in a proper employee handbook that includes a section on working from home.