Time fraud often starts with small mistakes, forgotten clock-outs, longer breaks, or missed meetings, but can be treated as a serious breach of trust, leading to a warning or even immediate dismissal. Technical issues or genuine misunderstandings, however, do not count as fraud. This article explains what legally constitutes time fraud, how it must be proven, and what rights employees have.
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Key takeaways
- Working time fraud means intentionally giving false information about hours worked. It includes false time entries, private activities during recorded working hours, or secretly extending breaks.
- Not every irregularity is fraud. If no intent is proven – for example due to unclear rules, technical errors or simple negligence – termination is usually unlawful.
- The employer carries the full burden of proof. Evidence must be clear, lawful and specific; illegal monitoring can make the entire case collapse.
- Consequences range from a written warning to immediate dismissal without notice, and in extreme cases even criminal charges.
- Accused employees should act quickly. Challenging a dismissal in Germany is common practice, and courts often decide in favor of workers.
Contents
What counts as working time fraud?
Working time fraud is any intentional act where an employee performs less work than contractually agreed upon while pretending otherwise. It can happen on-site or in home office settings. The key legal element is intent: the employee must knowingly create a false impression of working time.
Contractual duty to work
Employment contracts, collective bargaining agreements or company policies set out binding working hours. Employees must perform their work during these times and record their hours truthfully. Anyone who knowingly enters incorrect data or “covers up” absences risks being accused of working time fraud. Employees who are confronted with accusations should keep all records, timesheets, emails, and instructions. Good documentation often decides whether a dismissal survives in court.
Typical forms of working time fraud (condensed)
- False entries in time tracking systems
- Manipulating punch clocks or login records
- Private tasks during recorded work hours
- Excessive or undocumented breaks, late arrivals, early departures
- Invented travel or field-service time
- Repeated absence without reporting or catching up hours
Even a single proven act can be enough for termination if the employer can show deliberate deception.
Written warning for working time fraud
If the employer detects working time fraud, the usual first step is a written warning. It informs the employee of the breach, demands future compliance, and announces dismissal in case of repetition.
Employees may respond with a written counter-statement for their personnel file if the warning is unfair or factually wrong. This can be helpful later in court, especially if the employer claims the relationship was already “destroyed.”
Termination without notice for working time fraud
Courts see intentional working time fraud as a serious breach of trust. Therefore, termination without notice (fristlose Kündigung) can be valid even without a prior warning. This is more likely if the fraud was repeated, planned, or technically manipulated.
In practice, many employers still offer a severance payment rather than going through a long lawsuit. Labor courts often scrutinize the employer’s evidence very closely, and if intent cannot be proven, the dismissal fails. This litigation risk is why negotiations and settlements are extremely common in German dismissal cases.
Warning: Even a single and seemingly “minor” instance of time fraud can justify immediate dismissal. This was ruled by the Regional Labor Court of Hamm in the case of a severely disabled employee who had worked for many years as a cleaning staff member. The employer terminated her without notice after observing her taking a ten-minute coffee break in a nearby café. Both the Labor Court and the LAG confirmed that the dismissal was valid. A violation of working time recording can constitute a “just cause” for immediate termination under § 626 of the German Civil Code (BGB).1
Proving working time fraud: burden of proof
The employer must prove the fraud clearly and lawfully. This is often difficult, especially with flexible working hours or remote work.
Usable evidence
- Time logs, access cards, shift plans
- Witness statements from supervisors or colleagues
- Gaps between recorded hours and actual performance
Risky or unlawful evidence
- Secret surveillance software
- Full browser or desktop tracking without consent
- Permanent monitoring without a concrete suspicion
If evidence is collected illegally, courts may declare it unusable. Employers then lose the case even if fraud may have happened.
Frequently asked questions (FAQ)
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- Regional Labor Court of Hamm 27.03.2023, 13 Sa 1007/22 ↩︎
