5 Sneaky Practices to Cheat Time & Attendance Systems

5 Sneaky Practices Most Staff Use to Cheat Time & Attendance Systems

Employees frequently try to scam the attendance and time systems where they work. The following are five things are worth considering to avoid deception.

The provisions for overtime pay are outlined in the Fair Labor Standards Act (FLSA), which is managed by the Department of Labor’s (DOL) Wage and Hour Division (WHD). On 18 May 2016, President Obama signed the final rule for overtime regulations, which will update the FLSA to include an estimated 4 million employees, previously denied overtime or proper compensation. You can find additional information on the final rule here.


Deceptive Practices Employees Use

Every employer should have a written policy on time and attendance unless they have a lot of latitude in their workplace. This is often the case with employers who do not see a need to keep an employee chained to their desk when they have nothing to do.

According to the FLSA, when an employee is providing “physical or mental exertion (whether burdensome or not) controlled or required by the employer and pursued necessarily and primarily for the benefit of the employer of his business.”, it is considered time worked, even when an employee sits at his or her desk playing solitaire waiting for further instructions. Whatever your policy is, it must be enforced to provide a fair and consistent application.

When time and attendance policies are not strictly enforced, it opens the door to claims of favoritism. Additionally, when the policy is strictly enforced, all employees know exactly where they stand.

Take for instance when Sarah, an African-American employee is late on several occasions with no repercussions, and then Sally, a Caucasian employee is late twice in one week and docked an hour’s pay. This would leave the door open to accusations of favoritism based on race, particularly if the employer is an African-American.

Let’s face it, your employees are trying to make as much money as possible. In most cases, you cannot blame them for that, except when it cuts into your profits without adding anything to your bottom line, which in essence is theft.


Prevent Buddy Punching

That is exactly what a time sheet cheater is doing, stealing from their employer.

1. Buddy Assisted Time-Clock Manipulation

This is when John needs to leave early and asks Billy to punch his time card when Billy leaves. Or, Billy leaves without punching out, accidently or intentionally and calls John to do him a favor and punch his time card. Although it was an honest mistake, the subsequent call to his friend to clock him out much later, was not. Honest mistake or not it is dishonest to have another employee clock you out, and it subtracts from the employer’s bottom line.

2. Data Entry

Susie is great at her job; she should be she has been doing it for 40 years. Yes, her eyesight is not what it used to be, but she will come in on Saturday or holidays to get the hours recorded and the hours are almost always correct. At least you hope they are. Susie and John have worked together for this employer for 30 of the 40 years.

John tells Susie he forgot to punch in on the previous Saturday, knowing Susie did not work that day and neither did he. But, he tells Susie he did and she changes the time worked on his time sheet to reflect five additional hours, which gives him four hours of overtime he didn’t actually earn. This is fraud and embezzlement on both their parts.

3. Inflated Work Schedules

Billy always waits to clock out at just after five, so the liberal 15-minute rule, instituted by the employer, allows him to gather an additional one hour and 15 minutes each week. The additional time works out to an additional 62 hours and thirty minutes per year. That’s an additional week’s pay on top of the two weeks paid vacation the employer already gives him.


Unintentional Overtime

4. Unintentional Overtime

Because John is much better than Billy at preparing reports, he is always chosen to complete those. It doesn’t matter how many hours he has clocked for the week. If the supervisor checked or the system automatically updated hours daily, he would know John will work overtime while Billy leaves just a little after five every day because he doesn’t have to deal with those reports.

5. Human Error

Billy worked an additional two hours on Saturday to finish a project, after a sick day earlier in the week, the additional hours gave him 34 for the week. Susie while doing her data entry tasks, mistakenly gives those two hours to John giving him a total of 42 hours for the week. Although Billy notices he was shorted two hours and Susie corrects her mistake on Billy’s paycheck, she did not bother to investigate what happened about the two hours given to John.


Biometric Equipment

Steps You Can Take to Ensure you are not Cheated

Fingerprint reading, biometric equipment, and software can prevent fraudulent clock manipulation. This software can even be integrated with automatic recordkeeping to prevent logging inadvertent hours. Although, some of these measures can be very expensive, the return on investment (ROI) can be significant over the life of your business.

These systems can also give management “hours worked” tracking, to minimize the number of hours paid in overtime.

In summary, establish, post, and enforce attendance policies, so that every employee knows the policy and the penalties for noncompliance. Bring your business into the 21st Century by installing biometric tracking and software.


This content was provided by Neches FCU, an Equal Employment Opportunity Employer Credit Union.

Neches FCU is one of the top Texas credit unions and has a courteous and attentive team of professionals ready to service it’s wide base of members. When the doors open at any of the nine service outlets, our core objective of “Ultimate Member Satisfaction” becomes the sole focus for every representative. They are well-known for a personal, dynamic and upbeat work environment, providing a memorable service experience, and where clients are known personally. Neches FCU has approximately $438 Million in assets with over 45,000 members. Neches FCU is acknowledged by members and the business community as one of the top credit unions in Texas and an actively involved partner, helping our Family, Friends and Community!

The GOP Proposes A New Bill to Increase Taxpayer Protections

GOP Senators Introduce Bill to Create New Taxpayer Protections

There is growing frustration with the IRS and the tax code in general in the United States. There have been attempts at fixes before, and the latest one was introduced last week by two Republican Senators.

New Tax Bill
New Tax Bill

The bill was introduced by Sen. John Thune (R-SD) and Chuck Grassley (R-IA). The bill is called the Tax Payer Bill of Rights Enhancement Act, which is aimed at fixing problems that are causing the public to lose trust.

Improving IRS reputation

“The IRS’s level of customer service might be at an all-time low,” Grassley said in a written statement while introducing the bill. “Taxpayers are at a disadvantage with an agency that has tremendous power over their money. The IRS might talk about good customer service. Too often, talk is all there is. The IRS needs to walk the walk. Congress needs to act. This bill will help swing the pendulum away from agency self-preservation and back to taxpayer service.” Grassley and Thune are both on the Senate Finance Committee and should have detailed knowledge of the IRS.

IRS Service
IRS Service

IRS efforts

In an effort to improve its reputation, last June the IRS released a Tax Payer Bill of Rights that offered ways of dealing with the agency. The document is not a “legal document” and not enforceable. The two senators’ bill offers the enhancements that would give it more of a legal standing.

Another step

The IRS bill of rights was a step, but this bill will take it a step further. The bill has provisions that should help citizens in dealing with the IRS, and with understanding what their rights are.

Increased penalties

The bill increases damages and penalties for unauthorized disclosure or inspection of tax return information. It also increases civil damages for improper collection activities. It also requires that IRS employees be familiar with and cooperate with taxpayer protections. The bill would require employees be terminated for actions taken by the agency for political purposes.

Make information available
Make information available

Making information available

Taxpayers who are under investigation would also have more access to information regarding their cases. The bill would also allow taxpayers to bring action against the IRS for any illegal acts committed by the agency.

Protection for groups

It would add protections for 501c3 groups when the IRS does not act on an application in a timely manner or makes a negative judgment on their tax exempt status. The bill would prohibit IRS employees from using personal email accounts to do official business, so it would be harder to hide emails. It would also allow the use of taxpayer information to help find a taxpayer who is due a refund.

Other provisions

In other matters, the bill would allow tax exempt organizations to file forms electronically, and orders that the IRS make information available in a reasonable amount of time. The IRS had been criticized for not responding quickly enough to applications for tax exempt status at times. The bill also imposes requirements for email retention so emails could be examined and hold the IRS accountable.

Tax exempt groups
Tax exempt groups

Targeting tax exempt groups

The bill comes to some degree in response to the IRS admitting that it improperly scrutinizing tax exempt status of some conservative leaning groups. GOP officials have criticized the agency harshly in this area, and the bill would prevent some of that from happening in the future. The bill may also be considered to be retaliation to some degree. The IRS admitted that it had singled out some conservative groups, and emails that could have verified the level of that happening were apparently done on personal accounts and not retrievable during investigations.

IRS other problems

The IRS has other problems which cause the public to distrust them. The Senate has also shown its disapproval in recent years by reducing funding. Its funding has been cut by $1.2 billion over the past five years. The 2015 budget was $10.9 bi9llion, and could fall to $10.1 billion in 2016. That may or may not affect response times to calls when people try to contact the IRS, which has always been difficult. Reports from the treasury inspector general that was recently made public show that people who do get calls answered wait an average of 15.9 minutes, and that wait time was 8.1 minutes in 2011.


Author Bio:


I’m a Tax Professional based in Oregon. I love to speak about Tax and Accounting issues. I’m a businessman at heart, and like individuals who wish to build businesses and contribute to the economy.

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