Time attendance systems are designed to track employee hours worked, but fraudsters can use them to their advantage. By tampering with time cards or clock-in/clock-out times, they can inflate their hours worked and get paid for time they didn’t actually work.

This type of fraud is called “time theft” and it costs businesses billions of dollars every year. But there are ways to prevent it. By using a Time attendance system that includes features like fingerprint scanning or facial recognition, you can be sure that only authorized employees are able to clock in and out.

Here are some of the most common ways fraudsters attempt to exploit time attendance systems, and how you can protect your business from them.

Buddy Punching

One of the most common ways fraudsters attempt to exploit time attendance systems is by “buddy punching.” This is when an employee punches in or out for another employee who is not present. This can be done manually, by having someone else punch the time clock for them, or via a software workaround, by using a secondary device to remotely punch in or out for them.

Buddy punching can be difficult to catch, but there are a few ways to prevent it. First, you can require employees to use biometric authentication, such as a fingerprint scan, to punch in and out. This makes it much more difficult for someone to punch in or out for another person. 

Alternatively, you can set up your time attendance system to require employees to enter a code, such as their employee ID number, before they can punch in or out.

Time Shaving

Another way fraudsters attempt to exploit time attendance systems is by “time shaving.” This is when an employee tries to reduce the amount of time they’ve worked by fudging their start and end times. For example, an employee may start their shift a few minutes late but not clock in until they’ve actually started working. Or, they may clock out a few minutes early but continue working until their shift is actually over.

Time shaving can be difficult to catch, but there are a few ways to prevent it. You can set up your time attendance system to require employees to clock in and out at specific times. 

For example, you can set the system to only allow employees to clock in between 8:00 a.m. and 8:30 a.m., and to only allow them to clock out between 5:00 p.m. and 5:30 p.m. This makes it much more difficult for employees to shave time off of their shifts.

You can set up your Time attendance system to track the actual hours worked by each employee. This can be done via a software plugin or by integrating with a third-party time tracking system. This way, even if an employee tries to shave time off of their shift, you’ll still have a record of the actual hours they worked.

Falsifying Records

Finally, fraudsters may try to exploit time attendance systems by “falsifying records.” This is when an employee changes their time sheet or other records to show that they worked more (or less) than they actually did. For example, an employee may change their start time from 8:00 a.m. to 7:00 a.m., or they may change the number of hours they worked from 40 to 50.

Falsifying records is relatively easy to do, but there are a few ways to prevent it. First, you can require employees to submit their timesheets electronically, and set up the system to automatically compare the electronic time sheets with the data from the time attendance system. This way, if there are any discrepancies, you’ll be able to catch them quickly.

Alternatively, you can require employees to sign their timesheets before they’re submitted. This way, if an employee tries to change their timesheet after it’s been signed, you’ll be able to catch it.

Takeaway

Implementing a time attendance system is an effective way to deter and detect employee fraud. By using one of these systems, organizations can safeguard themselves against financial losses and protect their reputation.