The matter of employee theft involves anything from stealing office supplies and padding time to committing fraud. Eric Thole, attorney at law, highlights that most employee theft occurs out of the opportunity. Employees either didn’t know the policies, or the employer made the mistake of putting one person in charge of the finances. Eric Thole advises you to have a check and balance system to avoid money theft. Hire employees with separate authorization, record keeping, and asset custody (bank statement or credits/edits the invoice).
Signs Of Spotting Employee Theft
It is hard to detect employee theft, especially if someone is talented at hiding it. Be alert to these red flags-
- Cash amount discrepancies
- Missing inventory/supplies
- Changes in employee behavior
- refusal to hand over tasks to others
- unusual working hours
- poor work performance
- unjustified complaints about employment
- defensive attitude while reporting on work
- unexplained favoritism towards a supplier/customer
- a personal lifestyle not matching the salary
Methods To Handle Employee Theft
● Conduct Pre-Employment Background Check
Small businesses are potentially high marks for problematic employees. Be a part of the hiring process to eliminate such a threat. Eric Thole advises you to invest in employee screening to conduct a comprehensive background check before hiring anyone. It mitigates the chances of recruiting a risky hire for the job.
● Define Company Guidelines and Policies
Another way to protect your business from theft is by providing employees with clear company guidelines in a company handbook. Eric Thole, attorney at law, directs you to explicitly outline your company policies & procedures and give them to employees on their first day at work after a signed acknowledgment.
Such a handbook becomes valuable documentation in case of a lawsuit as it possesses your company’s expectations, ground rules, and acceptable/not acceptable behavior of employees in detail. It helps in holding employees accountable for their actions. It also opens communication for setting company expectations and ethical standards.
● Determine the Need for Investigation
You got a report of potential employee theft in your company. Now, how to handle it?
Eric Thole advises you to get an account of the situation before involving legal guns. For example, an employee theft report is sometimes a miscommunication or an unclear employee practice. Remember, legal action without investing in the facts can leave you vulnerable to an employment lawsuit.
Therefore, look at the facts, get to the bottom of the story, and identify whether it is an isolated incident with one person accusing another or an ongoing activity with several witnesses for the action. Weigh the situation first-
- What kind of theft has occurred?
- Is it a one-time act or a regular act?
- Did the employee in question make an honest mistake?
- Did the employee in question do the same with the past employers too?
- Is there a defined company policy about such actions, and does the employee know it?
Eric Thole advises you to look carefully at all aspects of a reported incident before launching a full-blown investigation.
● Report and Document
Once you have enough evidence to proceed with an investigation, talk to the accused employee and ask for an explanation. If you have CCTV cameras on the premises, check the footage.
If the camera clearly shows the theft incident or you have a significant number of witnesses, you can terminate the employee for misconduct without any explanation. Also, alert law enforcement if you need legal action.
(In situation after investigation) Eric Thole, attorney at law, suggests that if you decide to terminate an employee, use ‘misconduct’ instead of ‘theft’ as a reason for termination to avoid defamation claims from the former employee.
● Promote Honest Work Culture
The best way to promote an ethical work culture is by making employees aware of the company’s code of conduct. Hold training seminars on ethics to inform employees about the guidelines and company expectations and indulge in role-playing activities to teach proper behavior positively.
Conclusion
Eric Thole advises you to communicate background checks and company expectations/policies to the employees. If you communicate your expectations and have a provision in place in the event of a problem, you can safeguard your business to a great extent.
Eric Thole Attorney at Law 