Employee time theft is an issue that continues to be a thorn in the side for many employers. A few minutes here, a few minutes there. Surely, it’s not that big of a deal, right? With more employees accessing the internet than ever before and with a growing mobile workforce, time theft is getting even more challenging to prevent. For example, in a recent business.com survey of 1,000 workers, 54% of worker admitted to tackling personal tasks on company time.
When you examine the impact time theft can have on overall productivity and the bottom line, it’s no wonder more employers are cracking down and increasing enforcement.
Understanding Time Theft: What is it, Exactly?
Time theft occurs when the employee receives pay from an employer for work that they have not actually done, or for time that they have not actually worked. This is incredibly costly in terms of money and productivity. In the business.com survey cited above, 24% of workers said they overreport or otherwise manipulate the number of hours they work, resulting in an average of 4.5 hours per week of stolen time.
Common Types of Time Theft
Time theft happens in many ways, including making personal phone calls during work hours, excessively socializing with coworkers, rounding up timesheets, and even naps on the clock, according to 11% of business.com survey respondents. But some of the most common types of time theft include
Buddy Punching
Buddy punching happens when one employee clocks in or out on behalf of another, typically to cover for someone who is arriving late or leaving early. This practice is especially common in industries with hourly workers and manual timekeeping systems, such as construction, manufacturing, and retail.
Extended Breaks and Personal Activities
When employees take longer breaks than scheduled or spend work hours on personal errands, phone calls, or social media, it chips away at productivity. This form of time theft is often unintentional but becomes a pattern when left unchecked. It can be more prevalent in roles with less supervision or flexible work environments, where monitoring time on task is more difficult.
Falsifying Timesheets
Employees may manually adjust their clock-in and clock-out times to report more hours than they actually worked, especially when using paper timesheets or outdated systems. Some might round up their hours regularly, while others might log time they never worked at all. Detecting this type of time theft can be difficult without reliable time-tracking software or a system that flags inconsistencies for review.
Legal Consequences of Time Theft
When employees are caught misrepresenting their hours or productivity, employers may pursue disciplinary action, termination, or even legal proceedings. The consequences depend on company policies, local employment laws, and the severity of the offense.
Employment Law and Time Theft
Under most employment laws, time theft is considered a breach of trust and a form of fraud. Employers have the right to discipline or dismiss employees who falsify time records or abuse paid work hours. In some cases, especially when significant financial loss is involved, employees may face civil or criminal charges.
Examples of Time Theft Legal Actions
After a Canadian accountant sued her previous employer for wrongful termination, the employer filed a countersuit for timesheet fraud. With tracking software installed on her work-issued computer, the company found the employee was inflating her manual timesheets compared to actual hours worked. The former employee had to pay the company back $1,506.34.
An NYC sanitation worker was charged falsifying timesheets. The Bronx district attorney claims the worker took long breaks at home while on the clock, pocketing over $21,000 he didn’t rightfully earn. The worker is scheduled to appear in court in June 2025.
How to Prevent Time Theft
Tactics for reducing and preventing time theft at work include:
Implement Time-Tracking Systems
Paper timesheets are the simplest way for employees to steal time. For supervisors with multiple employees, it’s challenging to know the exact time each direct report arrives and departs each day. And it’s even more difficult to manage when working with remote employees. That’s why employers of all sizes rely on time and attendance software to carefully monitor hours worked. These solutions allow employers direct insight into hours worked and can provide alerts if employees forget to clock in or out.
Some time and attendance solutions even offer biometric time clocks that read employee fingerprints or handprints to prevent buddy punching. For field workers, geofencing solutions can automatically clock workers in once they reach a job site and clock them out once they leave.
Develop Clear Policies
To prevent time theft, employers should establish clear policies and communicate them to employees via a company handbook. It’s never safe to assume that employees know how to conduct themselves on the job. Instead, it’s up to the employer to explicitly state expectations regarding break periods, cell phone usage, and clocking in and out each day.
The company handbook should also include the disciplinary actions an employer can take against an employee for falsifying a time card, taking extended breaks, or spending time on sites like Facebook or Instagram during work hours. Finally, be sure that each employee reviews and signs a copy of the handbook. This will provide employers with proof of acknowledgement in the event an employee challenges any discipline taken against them.
Perform Regular Audits
Even with the right tools and policies in place, ongoing oversight is essential to prevent time theft. Employers should regularly audit time records to ensure hours worked match scheduled shifts and that no patterns of abuse emerge, such as repeated late arrivals or long breaks. These audits can be automated through time-tracking software or conducted manually, depending on the company’s size and resources.
Monitoring tools can also flag suspicious behavior in real time, such as frequent missed punches or inconsistencies between logged hours and job site activity. When paired with a clear review process, these checks promote accountability and help catch issues early before they grow into larger problems.
Enhance Employee Engagement
Employee engagement plays a key role in preventing time theft, as well as reducing presenteeism and absenteeism. The following strategies can help foster a more engaged and honest workforce.
Build a Trustworthy Work Environment
Creating a culture built on trust and transparency goes a long way in minimizing time theft. When employees feel respected, heard, and treated fairly, they’re more likely to act with integrity. Clear communication, consistent leadership, and opportunities for feedback help build that trust. In turn, employees are more engaged in their work and less likely to take advantage of the system.
Provide Incentives for Honest Reporting
Recognizing and rewarding employees for honest time reporting and punctuality can reinforce positive behavior. Incentives, such as bonus programs, recognition, or small perks, can motivate employees to maintain good habits. These initiatives foster a workplace culture where accountability is valued and employees take pride in showing up and doing their job well.
Addressng Time Theft in Remote Work
Time theft didn’t start with remote work, but the shift to home offices has certainly made it more complicated. When the lines between work and home blur, and managers can’t simply glance across the office to see who’s working, companies face a delicate challenge: how to maintain productivity without becoming the digital equivalent of Big Brother.
Challenges of Monitoring Remote Employees
Without physical oversight, it’s harder to confirm if hours worked match actual productivity. Distractions at home, flexible schedules, and the temptation to multitask can all contribute to unintentional or deliberate time theft. Employers must strike a balance between trust and verification.
Tools and Strategies for Remote Time Tracking
To address these challenges, companies should invest in remote-friendly time-tracking tools. Software with features like activity tracking, automatic time capture, and project-based logging can help monitor productivity without being overly invasive. Regular check-ins, clear output expectations, and outcome-based performance reviews also help keep remote teams aligned and accountable.
Psychological Factors Behind Time Theft
Time theft isn’t always about bad intentions. It often reflects deeper workplace issues. Understanding the psychological factors that drive this behavior can help employers take a more empathetic and strategic approach to time theft prevention.
Employee Motivations for Time Theft
Employees who engage in time theft may feel overworked, undervalued, or disengaged. Some may rationalize time theft as compensation for what they perceive as unfair treatment. Others might simply lack clarity on expectations or assume certain behaviors are acceptable if no one addresses them.
How to Address the Underlying Issues of Time Theft
To reduce time theft, employers need to dig into the root causes. Conducting employee satisfaction surveys, offering career development opportunities, and fostering open communication can help uncover and address dissatisfaction. In addition, set clear time policies that are outlined in an employee handbook and explained during onboarding.
How Paycor Helps
Paycor Time and Attendance software allows you to monitor and control labor costs through automated and accurate timekeeping processes. Proactive alerts and messages instantly notify users and administrators of any errors or discrepancies to avoid compliance issues or incorrect time cards. And with Paycor’s mobile punching feature, employers can set precise location maps to ensure employers are clocking in and out in or near the desired work location
In addition, Paycor Time and Attendance Clock solutions offer WiFi, PIN/badge entry, and multi-language readers. The Paycor Time Mobile Clock enhances flexibility with facial scan and offline capture.
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