Ghosts might be haunting your company!

BY salarium Articles

Ghosts might be haunting your company!

Are you afraid of ghosts? If you’re a business owner or are involved with paying employees, you should be! These are not your typical apparations that make things go bump in the night. These ghosts are the kind that can drain your company’s bank account without anyone noticing. We’re talking about ghost employees – a phenomenon observed around the world. Make this Halloween season a ghost employee awareness month in your company.

Here are some of the different types of ghost employees people have experienced:

  • Employees who are no longer with the company but are still getting paid;
  • Fictitious persons whose identity are entirely made up;
  • Individuals with real identity, usually a friend or a relative, who are part of the fraud but not actual employees

According to a case study by the Association of Certified Fraud Examiners, “The median loss for all cases in our study was $150,000, with 23.2% of cases causing losses of $1 million or more.” Those numbers should frighten any company owner, especially when it can be prevented. Keep in mind that when fraud begins, it typically starts small and grows over time, which could put you out of business without you knowing the real reason why.

Smudging sage won’t deter these ghosts from stealing, but proper and regular oversight can spook them from trying. Common ways to detect ghost employees include:

  • Employ overzealous bookkeepers, solely in charge of payroll,  who don’t take a vacation
  • Compare the number of employees on payroll to physical headcount in the company
  • Check employees who are getting paid differently than others. For example, if your company uses direct deposit as a payment method, look for employees getting paid in checks or cash
  • Look into the regular hiring of contractors or other forms of outsourced labor

In a real-world example of ghost employees in the Philippines, a Quezon City councilor named Roderick Paulate allegedly stole 1.109 million pesos, with the help of his friend, by hiring 30 ghost employees and pocketing their salary. That case is still ongoing in the courts. Davao isn’t ghost-free either. A former provincial board member of Davao Oriental was sentenced to 58 years in prison for a ghost employee scam, while 5 of her accomplices were sentenced to 18 years, for embezzling a combined 349,250 pesos.

How can you become a ghostbuster in your company? Besides investigating the common detection methods listed above, a foolproof way is to use biometric fingerprint devices for your companies time & attendance tracking. Ghosts don’t have fingerprints. Another solid way to prevent ghost employees is to have a digital time & attendance system for your company, like Salarium.

Salarium offers a robust time & attendance module in its payroll software system. Employees are able to clock in and out via a biometric fingerprint scanner, or through a digital Bundy clock that can be accessed on their phones or desktop. Employers can monitor attendance in real-time, showing tardiness at a glance. When payroll is ready, everything is calculated for you with consideration of tardiness, breaks, leaves, overtime/undertime, government deductions, company loans and more. You also have transparency on how people were paid – direct deposit, check or cash. If ghost employees are haunting your company, Salarium will exorcise them.

Best of all, Salarium only costs 25php per employee per payroll run. If you want to learn more about how Salarium can help your company, book a free demo below and we’ll show you in person, or online.

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