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Have you ever taken an extra 10 minutes on your break? Or maybe you’ve checked your personal email while on the jobsite? It might seem harmless, but all that time can really add up.
It’s called time theft and it’s a major issue for the construction industry.
Time theft, also commonly known as time fraud, occurs when employees are getting paid for work that they did not perform.
And even if you haven’t engaged in time theft yourself, according to QuickBooks® research, 49% of U.S. workers do admit to it. This ultimately costs U.S. employers $11 billion annually.
Although time theft has been unavoidable in the past, that doesn’t have to be the case anymore.
Using advanced time tracking software, you can ensure that your employees are only logging the hours they worked.
By leveraging the latest in time tracking technology, you can say goodbye to overinflated hours and overdue tasks that cause your projects to be past schedule and over budget.
How Time Theft Can Harm Your Projects
The bottom line is this: time theft eats directly into project profitability.
But let’s take a closer look at how that happens.
Compounding Time Theft
Most workers would acknowledge time theft, with many even admitting to doing it. On the surface, it doesn’t seem like a big deal, especially when it’s just a few minutes here and there. But this is exactly what makes time theft so dangerous.
Workers charging hours that they didn’t work inflates labor costs, which massively affects a project’s already thin profit margins.
Estimates and budgets then become compromised, which can lead to the construction project going over budget and past schedule, reducing your profitability.
Clients will most likely raise disputes and grow frustrated with the lack of progress on the project they are paying for, and eventually your reputation as a contractor will take a hit.
Furthermore, it can be very difficult to win new bids when you have the reputation of not getting projects done on time and on budget.
The Cost of Time Theft
The direct financial impact of time theft is easy to recognize. Buddy punching, overpayment and lost productivity all immediately impact your company’s wallet, but there are some more subtle ways in which time theft can cost you.
Low workforce morale and the loss in productivity often go hand in hand.
Workers who don’t steal time often resent workers who do. And when a company has no way of preventing this behavior, it can lead to widespread frustration with those disgruntled employees feeling undervalued for their labor in an unfair workplace.
This ultimately leads to a high turnover rate for your employees, forcing you to look for replacements.
Additionally, when time is being intentionally or accidentally stolen, it can lead to some serious compliance and legal risks.
For example, inaccurate records can lead to costly audits, where an auditor might review your financial statements and find major discrepancies, inefficiencies or fraudulent activities.
If an auditor finds that you violated any labor laws, like the Fair Labor Standards Act (FLSA), they can hit you with hefty fines and even initiate lawsuits.
How to Spot Time Theft in Construction
More than likely, you have already experienced time theft and its impacts. While it’s often easy to spot, it’s always good to be aware of every method of stealing time.
Once you know what time theft looks like, you can create plans to prevent it.
Common Ways Workers Steal Time
- Buddy Punching
- Here is an example: John clocks in for his friend / coworker Bill, who is still stuck in traffic and won’t arrive for another 25 minutes. This makes it look like Bill showed up on time, when, in fact, he just stole nearly half an hour of company time.
- Manipulating Paper Timesheets
- Outdated forms of time tracking, like physical timesheets that need to be manually filled out are easy to alter. Any worker could simply show up late or leave work early but still write in regular hours and there would be no way to verify it.
- Personal Activities
- This includes making personal calls, frequent phone use and running personal errands.
- Extended Breaks and Lunches
- Even just taking a couple extra minutes for lunch breaks can add up and impact how a project is estimated and budgeted.
- Unproductive Use of Time
- A worker might indirectly be stealing time just by not performing the work that they should be, either by not devoting their full attention or getting distracted in other ways.
How to Call Out Time Theft
Even if you already know the methods of time theft, how do you actually confirm that it’s happening?
If you suspect an employee of stealing time, there are a few ways you can find out, such as:
- Compare their work progress with their reported hours.
- Keep an eye if employees have similar clock in and clock out times over a period of time
- If they have inconsistent performance or completion time on similar tasks.
- Look for discrepancies in their time sheets, like exact hours copied over and over.
Putting an End to Time Theft And Lost Productivity
Understanding how time theft works is only part of the solution. Unfortunately, if preventing time theft and the loss in productivity was easy, it wouldn’t be so much of a problem.
A common struggle that many contractors face is deciding how to respond to time theft when it inevitably happens.
They might think that strict punishments or constant surveillance is the solution to eradicating stolen hours, but those options could make things worse, often leading to a high turnover rate from disgruntled employees.
In reality, it’s better to have a balanced approach that emphasizes communication and transparency. The goal is to improve behavior to benefit productivity, not to doll out penalties.
- Create and communicate a time theft policy that clearly detail expectations for each employee and their responsibly toward reporting accurate hours.
- Implement security measures for when employees log hours, like personal verification with a pin or facial recognition.
- Regularly conduct audits to identify any irregularities for fast and effective resolutions.
- Equip your supervisors and managers with training to identify and handle time theft incidents.
- Encourage worker accountability so everyone is responsible for their own time.
- Utilize time tracking software that offers tools to simplify and streamline hourly and task reporting.
Time Tracking Software: The Solution to Time Theft
A mobile time tracking app offers construction companies a powerful way to combat time theft along with the added perk of overall improved project management.
Here’s how:
- Accurate Time Records: GPS locating and biometric verification reduce buddy punching and false clock-ins, ensuring your employees log only the hours they actually work.
- Real-Time Monitoring: You can track your construction workforce attendance and progress instantly from anywhere, allowing for quick adjustments and better resource allocation.
- Offline Functionality: Field employees can clock in and out even without cell service, which is common on remote job sites. Once they’re reconnected, the data will sync up automatically.
- Assured Compliance: Accurate digital records will make it easier for you to meet labor law requirements and prepare for any audits, saving you from costly fines.
- Enhanced Accountability: With transparent and verifiable time logs, your employees will be more motivated to stay productive and follow company policies, keeping themselves and others accountable.
A time tracking app can eliminate the struggles of time theft, taking contractor time tracking from a manual headache into an automated and trustworthy process that protects everyone and saves you countless hours and dollars.
It might seem daunting to upgrade your time tracking system and convince your crews to use it, especially if you are used to manual timesheets.
But time tracking software is designed to be easy to use and immediately effective. If given the chance, you and your workers would quickly find it hard to imagine work without it.
Which Time Tracking Software is Best for You?
If you’re sold on the idea of investing in time tracking technology, you then have to choose which one to go with.
Selecting the right mobile time tracking app for construction means balancing functionality, ease of use and cost.
In addition to all the features previously mentioned, look for an app that offers integration capabilities with your existing payroll, project management, or accounting software. This will help streamline all your workflows, remove data silos and reduce manual field data entry.
A user-friendly interface is also a must have, ensuring your crews can easily and quickly adopt the application.
And if you foresee your company growing, look for a solution that prioritizes scalability, so its tools and services can grow with your business and adapt to evolving needs.
Finally, don’t overlook other contractors’ user experiences with using an app.
You should read user reviews and take advantage of any other product showcase options a time tracking provider might offer, such as a live demo, so you can be assured of your decision.
Prevent Stolen Time With WorkMax
Time theft in construction is a real problem, not only for the commercial industry, but also for the wider economy as a whole.
Even small, seemingly harmless time theft behaviors can compound into significant financial losses and damage your company’s reputation.
Recognizing common time theft tactics, such as buddy punching and extended breaks, is a crucial first step toward prevention.
However, using a mobile time tracking app is a full-proof solution to ensure accurate, real-time tracking of employee hours and their locations.
If you’re ready to say goodbye to time theft, consider WorkMax, Construction’s #1 time tracking software.
With WorkMax, you gain access to valuable construction-specific features, like:
- GPS location stamps
- Geofencing
- Facial recognition
- Cloud-based offline usage
- Add-on modules for reporting
- Integrations with accounting and payroll
To learn more, call or contact one of our specialists today!