Working time: Working time fraud: This is how companies can defend themselves

Berlin. They take a nap on duty, secretly go shopping and go to the gym or cook a bolognese - if employees only pretend to be working but do something different during this time, then it is working time fraud.

This is not that rare in Germany. In a survey by the market research institute Consumerfieldwork, 13 percent of 1,000 German employees stated that they regularly do not record their working hours correctly. And three quarters of the participants have already done something private when they actually should have been working.

Working time fraud is not a trivial offense, “but rather has enormous economic consequences,” says Sascha Stowasser. He heads the Institute for Applied Ergonomics (IFAA) and has been researching changes in the professional world for many years. “Absenteeism is very expensive for companies.”

In terms of labor law, the case is clear: “Anyone who intentionally acts as if they are working but is doing something else is cheating,” says Michael Fuhlrott, a labor law specialist. In practice, it does make a difference whether someone who clocks in instead of working from home spends three hours in the gym or just hangs out their laundry for a short time. What is fundamentally decisive, however, is the breach of duty. “And this exists even with a short, unspecified break.”

What many people don't take into account is that even those who have agreed on trust-based working hours with their employer can commit working time fraud. Here it is not a problem if someone takes a longer break without stating it. “However, if someone only works 20 hours per week instead of the agreed 40, this is a breach of duty,” says Fuhlrott.

Such scams can have far-reaching consequences. In the worst case scenario, anyone who intentionally deceives may be terminated without notice. At the beginning of 2025, says Fuhlrott, the Cologne State Labor Court ruled in favor of a transport company. A ticket inspector who could prove that he had spent his working hours with his girlfriend, in cafés or at the hairdresser's could be dismissed without notice. He also had to cover the costs of a detective amounting to 21,000 euros.

“But these are extreme cases,” says Fuhlrott. Labor courts would take a clear line here - but they also take into account the intensity of the fraud and the length of employment. “Someone who has worked in the same company for 30 years and once incorrectly records 20 minutes is treated differently than someone who has only been there for two years and regularly records several hours incorrectly.”

In practice, compensation for damages such as in the Cologne case or even criminal prosecution for fraudulent working hours rarely occur. Criminal prosecution is possible. After all, it is a scam. “The public prosecutor’s office generally shows little zeal for prosecution here.”

Even if it seems different at first glance, working time fraud is not a new problem. “Decades ago, employees secretly did private things while working,” says labor scientist Stowasser. For example, by secretly browsing Facebook or eBay in the office instead of moving forward with the new project. Or by making private phone calls.

According to Stowasser, most employees do not act out of resentment or vengeful intent. Working time fraud, he says, is primarily caused by poorly set goals and a lack of leadership. “If there are no clear goals, freedom arises that employees then use for their own benefit.” For example, to do the shopping or surf the Internet.

If superiors fail to notice such violations over a long period of time, it is an obvious leadership failure, says Stowasser. “Bosses have to have discussions to find out what realistic goals are for their employees,” he says. But they often don't even know how long their team members need to complete a task.

In order to punish working time fraud, the boss must first be aware of it. He is not allowed to simply control what his employees are doing in their home office or even hire a private detective to investigate them. “This requires concrete suspicion,” says legal expert Fuhlrott.

This means: The employer must have certain evidence of his employee's misconduct. “Colleagues often gossip,” says Fuhlrott. There have been times in his career where an ex-partner gave the crucial tip.

Raoul Classen knows many such cases. He has been working as a private detective for more than 30 years. If he observes someone on behalf of a company, he must adhere to clear rules. For example, he is not allowed to secretly gain access to an apartment and install a camera there. This would mean he would not be committing a crime himself. “The video would never be admitted as evidence in court.” The same applies to sound recordings that are made without being asked.

“For data protection reasons, the use of a private detective is only permitted within very narrow limits,” says Nathale Oberthür, an employment lawyer in Cologne. The surveillance must meet three criteria: it must be suitable for clarification, necessary and proportionate. This means that companies are only allowed to hire a private detective if there is no other way to clarify a matter.

Furthermore, observation may not last for weeks. Not even if there is a reasonable suspicion of working time fraud. If a detective does not adhere to this, says Oberthür, the evidence collected cannot be used in court. In addition, an employee can demand compensation for violations of data protection or personal rights.

The use of AI in particular has changed the pace of many people's everyday work. If you are good at using the appropriate tools, you can complete many tasks much faster than before. But what happens if someone performs the same or even better than their colleagues - but only needs 30 instead of 40 hours per week?

Even then, according to Fuhlrott, the employee is not allowed to simply close the laptop before the end of work. “Employment contracts are generally service contracts,” says legal expert Fuhlrott. This means that most employees are paid by the hour rather than by performance or output.

However, from the perspective of labor researcher Stowasser, a system that is based on times and not on results is outdated. “If someone completes their tasks efficiently, why shouldn’t they be able to leave an hour early?” he asks.

Stowasser sees a structural problem here: Many companies still find it difficult to combine modern working time models with clear goals. “Anyone who sanctions quality and speed instead of rewarding them causes frustration among the workforce,” says Stowasser. “And this often leads to covert refusal to perform.”