By Kyle Allerton
As a business owner or manager, when you think of the word ‘theft,’ your mind likely immediately wanders to somebody coming into your place of business, physically removing an item, and then leaving without paying for it.
Of course, the more valuable this item is, the bigger the issue is going to be for you.
Many business owners do not realize there is a growing trend among employees that results in a different kind of theft from a business owner: buddy punching. And it’s a theft that happens on a substantial grand in many unsuspecting businesses.
What is Buddy Punching?
The concept behind buddy punching is pretty simple.
Imagine this:
Scott and Brad are both employees at your business and happen to be pretty good friends. They are both scheduled to start working at 1pm on the same day. Brad shows up about 15 minutes prior to the shift starting and goes through his usual routine. Right before the clock strikes one, he gets a frantic text message from Scott. His friend is stuck in traffic and really cannot afford to have a smaller paycheck because of the missed time.
Brad tells him not to worry. Brad punches in right at 1pm, but then also punches Scott in as well despite him still being stuck in traffic and not at work.
In other words, the concept of buddy punching is when one employee is either running late, like Scott in the aforementioned example, or is completely absent from work and has a colleague, who is present, clock them in.
Buddy punching can allow an employee to sneak in free time, if they are running just a few minutes behind. Or, like in the above example, could allow an employee to receive thirty minutes, an hour, or even a whole shift of paid time without ever actually attending their shift.
Of course, no amount of buddy punching should be an acceptable practice within your business. In fact, the process of buddy punching can ultimately lead to the loss of thousands of dollars to employees partaking in the practice. It also creates a negative impact on team morale; staff not involved in buddy punching feel conflicted as to whether or not they should report the problem, and also feel they are missing out on free money.
Buddy Punching is a Widespread Problem
In 2017, the research company Pollfish conducted an independent survey of roughly 1,000 employees. The results were quite startling. Of the 1,000 employees interviewed, 16% of them admitted to regularly partaking in the buddy punching process – either as the one being punched in, or the one helping a coworker out.
One-hundred and sixty out of 1,000 employees doing buddy punching is just a small sample of a much larger problem. If you correlate those numbers on a larger level – such as nationally – it becomes even more eye opening.
For comparison, the U.S. Bureau of Labor Statistics estimates that there are roughly 78 million hourly workers in the United States workforce.
What happens if the 16% from the Pollfish research stays consistent on a larger scale, like the Bureau of Labor Statistics’ estimate?
That would mean 1.2 million people nationwide are regularly participating in buddy punching. The American Payroll Association estimates that nearly 75% of companies throughout the country regularly lose money because of employees engaging in the process of buddy punching, with nearly 4.5 hours each and every week being poached by multiple employees without actually having worked the hours.
Because of this, the APA argues that upwards of $350 million worth of capital is lost each and every year to buddy punching. That is a massive number, and it becomes doubly concerning when one considers the smaller, “ma and pa” type businesses that lose money they cannot afford to lose due to buddy punching.
The Biggest Sign That You Have a Buddy Punching Problem
As a business owner, there is one thing that will allow you to determine whether or not you have a buddy punching problem.
If you look at your timesheets and you notice that your employees are rarely tardy and not missing work for pre-documented personal and private reasons, it is a fair assumption that perhaps you have a buddy punching problem.
Research conducted by Career Builder found that just under 30% of employees show up late to work at least once a month. Moreover, the same research found that 16% of employees said they were tardy on nearly a weekly basis.
It is safe to assume that your business is also part of that trend. You may not have 30% of your employees showing up late on a monthly basis, but the chance of that number being close to 0% is just not likely.
If you notice that all your employees are always on time and not missing days of work, then doing spot checks may be a good idea. See that somebody is currently clocked in? Go to their area and physically confirm that they are at work. If you are unable to find them, then you have the right to approach them at a later time and question where the discrepancy is.
How To End Buddy Punching in Your Company
Immediately addressing the concept of buddy punching as a form of theft is very important. Many employees may not look at buddy punching on such strict terms. So, it is up to you – as their employer – to unequivocally tell them that buddy punching is indeed theft and that there will be repercussions for partaking in the activity.
With that in mind, the first way to end buddy punching in your company is by establishing a strict zero-tolerance policy and enforcing it without question.
Establish a Zero-Tolerance Policy Towards Buddy Punching
Most employees go through some sort of employee training prior to beginning their position in full. Often times, this training includes a meeting with a human resource officer where the rules and regulations of the company are laid out for the employees to sign off on. A good first step to ending buddy punching is to establish a zero-tolerance policy that outlines the process as nothing less than theft.
Going that route requires one important thing, though: absolute enforcement. If you do catch an employee engaging in buddy punching, it is important that you follow through and punish the employee as you laid out in the policy. This could be a light punishment, to severe – such as losing their job.
However, you must keep employee morale in mind when deciding on how to punish buddy punching. Immediate termination is certainly not out of line, but it could alienate your current employees and cause an adverse working environment and relationship. Consider the culture of your workplace when considering the punishment for buddy punching.
Regardless, once you decide on the type of punishment, you must follow through on it with each and every occasion of buddy punching. If not, you are opening the door for other employees to do it without facing repercussions.
Establish a Geofence Around Your Business Premises
It may sound a little sci-fi, but the establishment of a geofence around your business premises is a more advanced step you can take to curb the process of buddy punching.
The process of geofencing is actually pretty simple. Your attendance technology is set up so that employees are only allowed to ‘clock in’ when they are in a certain radius from the office – say 10 metres – using ID cards or their phones.
While a geofence is certainly a step up from many of the old forms of time-clock management, employees could still share ID cards or phones so as to make buddy punching a real possibility even with the technology.
Use a Biometric Timeclock
Of the three possible methods to stop buddy punching, the installation of a biometric timeclock is probably the only way to completely to end the process.
Most companies or organizations still use the “old school” method of time clock management – that is, either the physical punching of a card, or the use of a point-of-sale system where an employee enters a number to clock in, and then does it again to clock out.
A biometric system does away with both of those. Rather, a biometric system will read an employees’ fingerprints and/or face to successfully clock the person in and out of work. The idea of installing a biometric system may sound like an incredibly expensive investment. But, surprisingly, the cost to do so is relatively low. Moreover, the return on investment you earn by not losing money to buddy punching makes the system completely worth it.
Conclusion: Putting an End to Buddy Punching
By now, you should be aware that the act of buddy punching could significantly harm the bottom line of your business. Moreover, if done often, you will find that not only is your net profit being damaged, but the work and projects that are supposed to be completed are not being done in a timely fashion.
Buddy punching can truly be a double whammy.
Because of that, not only should you be aware of the signs that employees may be partaking in buddy punching, but you should also be prepared to take immediate action if you suspect the process is occurring.
Even if you believe that buddy punching is not happening within your business, you should preemptively establish a strict zero-tolerance policy and be prepared to enforce it as needed in the future. If buddy punching is already an issue plaguing your business, or if you’d prefer to get ahead of the curve, biometric time tracking technology is your best bet.
