Plugging Payroll Leaks
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The study also noted a large number of manually entered time cards. “The frequency of the manual editing of time cards tells us that either we are having some issues with people not understanding or using the technology, or it may be an opportunity where when someone is five minutes late they write it down in a log rather than clock in. That tells us we are probably overpaying people,” says Knasel.
Based on the analysis, Saint Luke’s estimates that at least 7% of its employees may be overusing the manual time sheet opportunity.
While five minutes may seem like a paltry amount, Knasel says the time adds up. For instance, if each person at a 200-employee hospital takes an extra 10 minutes on the clock daily, that’s nearly an hour extra in their check each week. Not factoring in that it may cost additional in overtime pay, annualize that for employees using a low, $15-an-hour wage and the cost is $780 a year per employee. If all 200 employees overcharge the hospital by 10 minutes a day, the hospital loses $156,000 annually. In all likelihood, however, the amount is significantly higher due to the variance in hourly wages.
Saint Luke’s is planning to work on the documentation portion of its system to remove the written time entry “exception” from the system. It’s a process that, Leslie explains, will be accompanied by supporting human resources policies and communication with the employees.
Karen Minich-Pourshadi is a Senior Editor with HealthLeaders Media.
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