Exposing Working Time Fraud

In every employment relationship, it is of great importance that employers and employees can trust one another. Naturally, this trust is significantly reduced when it is abused, for example if an employee commits theft or deliberately makes false statements about their working hours. How such fraud can be uncovered by our Hamburg detectives and what consequences may result is explained in this article by Laura Gosemann for Kurtz Detective Agency Hamburg.

Summary Dismissal upon Discovery

In the case of so-called working time fraud, case law assumes an intentional breach by the employee, namely the deliberate failure to record working time correctly. This also initially entails an obligation on the employer to inform their employees clearly about how working and stand-by times are handled. Working time fraud usually destroys trust permanently, meaning that any further cooperation is no longer reasonable for the employer. Summary dismissal is justified in such cases – often even without prior warning. Our commercial detectives in Hamburg document the necessary evidence admissible in court.

Types of Working Time Fraud

Court rulings to date have exposed some common methods of working time fraud, which experienced detectives are of course already familiar with. When using time recording systems such as a time clock or similar, clocking in or out is often carried out by a third party, or employees simply fail to clock out, for example during smoking breaks. Carrying out private errands during working hours is also impermissible. The same applies to private telephone calls or other correspondence via email or letter. Surfing the internet instead of carrying out duties within the employment relationship also constitutes working time fraud, of course.

 

In the surveillance operations carried out by our Hamburg private detectives, working time fraudsters are observed idling instead of working, carrying out secondary employment during their actual working hours, visiting cinemas, concerts and sporting events, or enjoying a cheerful rendezvous by the roadside.

Potentially Immense Damage for Affected Companies

On the one hand, the trust damage caused by time-sheet fraud is considerable. On the other hand, economic losses are likely to arise for the company in most cases. Not only is the employee paid even though the work assigned to them is not being carried out, but the unaccounted loss of labour can also lead to significant loss of turnover depending on the employee’s role, pose a security risk and or increase the stress level of colleagues, thereby substantially reducing the internal capacity to work productively.

Possible Consequences of Working Time Fraud for Employees

As a matter of principle, proven time fraud justifies summary dismissal. This not only leads to the obvious loss of the job and thus of income, but also entails a three-month waiting period for unemployment benefit and a negative employment reference. If the civil law review shows that the employee received salary without entitlement, or if private investigators were engaged to prove the fraud, thereby incurring detective costs, repayment claims may also arise. Criminal prosecution is also not impossible, though less common, since fraud is a criminal offence (Section 263 of the German Criminal Code).

Exposing Billing Fraud

Pursuant to Section 32(1) of the Federal Data Protection Act (BDSG) – “collection, processing and use of personal data for the purposes of an employment relationship” – the collection of employees’ personal data is permitted “if this is necessary for the decision on establishing an employment relationship or, after the employment relationship has been established, for its implementation or termination”. In other words: if an employer is considering dismissing an employee, they may collect personal information about them as a decision-making aid, and therefore may also engage detectives.

 

That it is not quite so straightforward is demonstrated by case law on a regular basis. However, if there is in fact a concrete suspicion of fraud against an employee, it is entirely legitimate to follow up on that suspicion, if necessary with the help of detectives. In the event of suspected false billing, whether in relation to working time records or submitted expenses, our commercial detective agency in Hamburg can therefore be engaged to check whether the employee is fulfilling their employment contract. Technical solutions are also conceivable, for which well-equipped private and commercial investigators are usually likewise available. For example, the time recording system may be monitored by cameras. However, this method must first be approved by the works council or staff council, and employees must also be informed about the recordings.

Observe Proportionality of Means

With regard to all control and surveillance measures against employees, the iron rule is that they must not be disproportionate, so as not to interfere with personality rights more than necessary. For example, on 4 October 2012 the Labour Court in Augsburg ruled that computer monitoring by storing screenshots every second for five to seven minutes infringed the employee’s personality rights – even though it did provide proof of working time fraud. In particular because private email communication was also documented, the monitoring measure was deemed disproportionate.

Author: Laura Gosemann

 

Kurtz Detective Agency Hamburg

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