Many companies may not be familiar with this term, but buddy punching can have a substantial impact on your business. In 2017, out of 1000 surveyed employees, 16 percent admitted to clocking in for a coworker. The same survey also found that the most common mistake for weekly timesheets is employees adding time, usually around 15 minutes. While 15 minutes may not seem substantial, this can cause an annual loss of $373 million dollars in all businesses with hourly workers. Buddy punching can be extremely costly to a company, but with the proper knowledge and help from Journey Payroll, it can be prevented!
What Is Buddy Punching?
If you haven’t heard of buddy punching, you’re not alone. Buddy punching is when one employee clocks another employee in or out of work shifts when that employee isn’t present. In fact, 75 percent of small businesses in the United States are impacted by buddy punching.
You may be wondering, is buddy punching illegal? The answer is yes. Not only is buddy punching dishonest, but it also can be grounds for termination. When employees are buddy punching, employers are paying for work that hasn’t actually been done.
How Is Buddy Punching Typically Accomplished by Employees?
There are three ways that buddy punching can be accomplished. In all of these scenarios, personal login information such as usernames and passwords are shared between employees. Below are three scenarios in which buddy punching may occur:
- In the first scenario, employee A is running late, so employee B clocks them in.
- In the second scenario, employee A takes a long lunch break or leaves work to run an errand. If they aren’t back in time for work, employee B clocks them back in.
- In the last scenario, employee A leaves work early. Employee B stays until work is over and clocks them out at the time employees normally leave.
What Are the Consequences of Employees Buddy Punching?
Buddy punching robs the employer of time and money and creates a dishonest workplace.
Skewed productivity levels
An employer thinks that a certain amount of work has been done based on how long employees are clocked in. However, if employees are buddy punching, then the hours that have been worked are not an accurate reflection of what work has actually been done.
Increased payroll cost
There are 78 million hourly workers in the United States, and if just 16% of those employees engage in buddy punching by adding just 15 minutes to a coworker’s time, this results in a loss of $373 million dollars annually. While a few minutes here and there may not seem like it can have a large effect, it can monumentally cut into a company’s revenue.
Low employee engagement / poor work culture-dishonest
Buddy punching also negatively impacts a company’s work culture. If an employee lies and asks other employees to lie for them, it creates a dishonest environment. Additionally, if employees see that lying at work is accepted, they may see what else they can get away with. Buddy punching creates a bad work environment where dishonest behavior is tolerated and rewarded by being paid for time that is not actually worked.
How to prevent buddy punching in the workplace
By utilizing policies, passwords and new technologies, you can stop buddy punching in your work place once and for all.
Create a zero-tolerance policy
Let your employees know that buddy punching will not be tolerated under any circumstances. Verbally communicate this to your employees and post a paper copy of this in the workplace to further drive the point. Lastly, inform employees that buddy punching is grounds for immediate termination.
Give each employee a specific password to clock in. This should be a long sequence with numbers, special characters, and capitalization. Complex passwords are harder to share amongst employees. There is also the risk that if employees share passwords with coworkers, coworkers will have access to an employee’s accounts and personal information. Strong passwords are a deterrent to buddy punching.
Utilize new emerging technologies
New technologies can help combat buddy punching without requiring extra work on the employer’s end. Journey Payroll has time tracking technology that will prevent buddy punching in your workplace:
GPS tracking: Employees’ locations are shown when they clock in. If they don’t clock in at work, their employer will know. Any other movements can also be tracked if an employee leaves while still clocked in.
Geofencing: Similar to GPS tracking, with geofencing an employee can only clock in within a certain perimeter of work. Geofencing perimeters and options can also be customized.
Checking the IP address: Only allow your employees to check in from approved IP addresses. This is another way to ensure that employees only clock in from allowed locations. IP addresses are only viable if employees always work at the same location.
Biometrics: This uses fingerprints, hand scanning, or retina scanning and prevents anyone but the employee from clocking in.
Work on improving your company culture
Cultivate a work culture that prides itself on honesty and accountability. By creating a positive and open work environment, you are less likely to see employees engaging in buddy punching and other dishonest practices.
Journey Payroll will stop buddy punching in its tracks!
No company wants to micromanage employees or be worried about losing revenue. By creating an honest work environment, using strong passwords, and outside technology from Journey Payroll, buddy punching can be stopped before it even starts. Journey Payroll’s Time Clock Services will help track employee hours and prevent buddy punching. Maximize your company’s earnings and potential by using our time clocks. We look forward to working with you!