Additionally, the invasive investigation into your company’s practices will disrupt the work environment, lowering employee morale and jeopardizing your business’s reputation. This could include retroactive payment, such as unpaid wages and unpaid overtime pay, as well as fines. If the employee claims they are owed unpaid wages or overtime, without being able to produce accurate time and attendance and wage records, you could be found as violating the FLSA and face a cash settlement. If met with resistance from management for requesting these records, the employee can notify the Department of Labor, who can then open an investigation and look into these claims. Not only is accuracy at the question, but the employee also has no way of knowing whether their hours are being dutifully tracked, reported, and accounted for. This lax system of time recording creates an opportunity for wage theft, as time is not tracked to the minute and little effort is expended confirming that the hours are correct. Instead, supervisors are trusted to keep an eye on every worker’s time, and payroll is run based on the hours they report, regardless of whether or not the times are accurate. Employees may receive no instruction or information regarding how their time is monitored. However, for smaller businesses, tracking employee time is often treated more casually. The Fair Labor Standards Act requires all covered employers to keep certain records for each nonexempt worker, including hours worked each day and total hours worked each workweek.

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