Time Theft in California: Key Information for Organizations and Employees
Whether you're grappling with employees clocking in extra minutes they haven't worked or buddy-punching their way to a bigger paycheck, time theft is more than just a nuisance; it’s a severe risk to your business.
This article will explore time theft in California, examining its impact, the legal measures taken to address it, and the ongoing efforts to prevent it.
The Scope and Impact of Time Theft in California
Time theft refers to situations where employees are paid for time they have not worked. This can range from taking longer breaks without approval to sophisticated schemes like buddy punchings or working side jobs on company time.
Although they may sometimes seem subtle, the effects of time theft are anything but.
Let’s look at a real-life example.
In a recent Bay Area Rapid Transit inspector general investigation, three employees were found committing time theft by clocking in for work and then spending most of their time at home.
Despite not being approved for remote work, these employees claimed to be working 10-hour in-person shifts but were only present at their assignments briefly before returning home.
During this period, they improperly collected overtime, double-time pay, and other benefits that significantly inflated their compensation.
The misconduct led to substantial financial losses for BART. Legal actions followed, with criminal charges filed against one of the employees who has since retired.
And how about the broader implications of this fraudulent behavior?
Here are just a few of them:
❌Financial Impact. The financial ramifications of time theft experienced by BART are considerable. The direct losses from the stolen wages of just one employee amounted to at least $9,004, indicating that the total sum lost could be much higher. If this behavior were to be replicated by more employees, the cumulative financial impact would escalate significantly.
❌Morale and Trust. This type of time theft can severely undermine employee morale and erode trust. Employees who adhere to their schedules and fulfill their work commitments might feel demoralized or unfairly treated when they see colleagues engaging in fraudulent behavior without repercussions.
❌Legal and Compliance Risks. In California, accurate timekeeping is a legal obligation. The incidents of time theft at BART, especially involving fraudulent claims of overtime and double-time, expose the agency to significant legal and compliance risks. Such violations could lead to legal actions, including claims for failing to enforce working hours properly.
❌Public Credibility and Operational Integrity. As a public transit authority, BART is accountable not only to its employees but also to tax-paying citizens. Incidents of time theft can undermine public trust in the agency’s ability to manage its resources effectively.
✅ If BART Employees Were Using Timeero, None of This Would Have Happened! ✅
Timesheet fraud is a prevalent issue that can drain your company’s resources and undermine trust within your organization.
However, this doesn’t have to be your reality.
A practical solution to this problem is switching from manual timesheets to reliable and accurate GPS time-tracking software like Timeero.
Most Common Types of Time Theft
Time theft may manifest itself in several forms, each with its unique challenges and implications for employers.
From schemes like buddy punching and “ghost employee” to completing personal tasks during work hours, understanding these behaviors can help effectively detect and prevent these situations.
Explore the most common types of time theft in the workplace and learn how to address them in our detailed Guide to prevent employee time theft.
Is Time Theft a Crime in California?
In California, theft is universally recognized as a crime, with various classifications and penalties based on the value of the property stolen.
However, while not explicitly defined under federal law, time theft is typically categorized more as employee misconduct than a criminal act. The odds are that falsifying time records or buddy punching won’t commonly be prosecuted directly under standard theft laws.
That said, some instances of time theft could potentially lead to criminal prosecution under certain conditions. If an employee deliberately falsifies time records to receive payment for unpaid hours, such actions could be considered fraud or theft.
Referring to our previous example of BART employees, significant amounts of time were falsely claimed as wages, which might potentially trigger criminal charges.
Off the Clock Work as Time Theft in California?
In California, off-the-clock work is a significant concern related to time theft and wage theft laws.
California labor law requires employers to pay for all hours an employee works, including minimum wage, overtime, and any preparatory or concluding activities integral to the employee's main job duties.
Not compensating employees for these hours constitutes wage theft.
However, if employees voluntarily work extra hours without reporting them or employers subtly encourage such behavior without formal approval, it can also be considered time theft. This is because the employer benefits from unpaid work, which basically "steals" time from employees.
Unpaid off-the-clock work can lead to audits, penalties, and lawsuits, including PAGA claims and class action lawsuits, where fines can be substantial.
One of the crucial elements in addressing off-the-clock work in California is the issue of intent. Proving that an employer intentionally required or allowed off-the-clock work can mean a difference between a simple payroll error and a severe violation of wage and hour laws.
❗ Employees who hide their off-the-clock work from employers can complicate compliance efforts and cause legal trouble. Inform your employees that no off-the-clock work is acceptable.
How Can Timeero Help You Prevent Time Theft in California?
Choosing a reliable GPS tracking app is one of the most effective ways to prevent time fraud.
Timeero offers several robust features that can protect your company by accurately tracking and reporting employee work hours and related compensation.
1. GPS Time Clock
Timeero’s mobile GPS time clock ensures that every clock in and out is tied to an employee's location, guaranteeing that time cards are 100% accurate.
With Timeero’s geofencing feature, employers can set up virtual boundaries around their workplace or other approved work sites. If an employee clocks in offsite, their timesheet will be flagged.
Employers can also restrict employees from clocking in and out outside of these predefined areas, ensuring they are physically present at the job site during their reported working hours.
2. Biometric Time Clock
Timeero’s biometric verification ensures that the person clocking in is indeed the employee, preventing anyone from clocking in on behalf of someone else. Enabling facial recognition when clocking in and out eliminates the risk of buddy punching.
3. Real-Time Monitoring and Shift Management
Timeero provides a real-time overview of who is working and relevant details pertaining to employee shifts such as current work location and time spent on the clock, making it easier for managers to verify work hours against scheduled shifts. If any discrepancies or unusual patterns occur, they can be addressed immediately.
Tracking with Timeero only occurs during an employee’s workday, so your company can easily comply with GPS tracking laws in California.
4. Real-Time Overtime Monitoring
With Timeero, employers can set overtime thresholds and receive notifications when employees are about to exceed these limits. This helps manage labor costs and prevents employees from claiming overtime hours they did not work.
This means no excessive or unauthorized overtime claims, safeguarding the company against inflated labor costs due to fraudulent time entries.
5. Accurate Break Tracking
Complying with state-specific employment laws, such as those mandating meal and rest breaks, is required in California.
Timeero’s California break tracking feature helps you enforce your meal break policy by ensuring employees track and attest to their breaks.
6. Audit Trails and Timesheet Approvals
Timeero allows you to set different user roles and define who can approve timesheets and who can make adjustments. Every change made to a timesheet is recorded, creating a paper trail that offers transparency and accountability.
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This feature ensures that any attempt to alter timesheets can be traced and addressed promptly, which is vital in combating timesheet fraud.
7. Customizable Settings for Local Compliance
Recognizing that labor laws vary by location, Timeero offers customizable settings that you can adjust to meet local wage and hour regulations.
For example, time-rounding is not advisable in California, especially when tracking employee lunch breaks. Timeero lets you customize this setting, too.
This adaptability ensures compliance with specific legal requirements, protecting against time and wage theft due to non-compliance with labor standards.
8. Accurate and Timely Payroll
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Timeero integrates with some of the most popular accounting and payroll solutions. This means you can eliminate all manual work and run payroll smoothly with just a few clicks, free of errors.
How Do Employers Deal With Suspected Time Theft in California?
In addition to using dependable timekeeping solutions like Timeero, employers can adopt several proactive strategies to detect, prevent, and address time theft.
✅ Develop an Employee Time Theft Policy
Every company must have a clear policy that defines time theft and outlines the consequences of such actions. This policy should be communicated to all employees to ensure they understand what behaviors are considered time theft and the penalties and disciplinary action they could face.
✅ Train Managers to Monitor Timesheets
Managers play a large role in preventing time theft by regularly reviewing timesheets for irregularities. Training managers to recognize the signs of time theft can help catch issues early before they escalate into more significant problems.
✅ Run Unannounced Audits
Regular, unannounced audits of timekeeping records can be an effective measure to prevent time theft. These audits help maintain an environment of accountability and can identify patterns of misconduct that may not be apparent during routine checks.
✅ Resolve Employee Issues Promptly
Addressing employee issues can prevent frustrations that often lead to time theft. A responsive HR department and open communication in the workplace can mitigate many issues.
✅ Take Steps Toward Legal Action
If you suspect your employees committed time theft, ensure they receive due wages before pursuing any disciplinary or legal action. Following the appropriate steps toward legal action will help you avoid legal and financial trouble.
Disclaimer: This article should not be taken as legal advice. It is provided for informational purposes. Please consult with qualified legal professionals for specific guidance on labor code and compliance with the Fair Labor Standards Act (FLSA).
