Don’t let your business fall victim to employee theft

While you always strive to hire model employees, in reality, new hires don’t always work out and in some cases may even steal from the company. However, employee theft can be effectively controlled with a loss prevention strategy that involves being selective about who you hire and making sure employees understand the consequences of their actions.

Employees who steal might have easy access to cash or merchandise, feel they’re not paid enough, or are having financial problems. Removing any of these motivating factors — particularly opportunity — will reduce losses seeing as an increased risk of being caught reduces the probability of theft.

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General advice

  • Implement a pre-employment screening program that includes reference checks. You may also want to perform criminal and credit checks depending on the position you’re hiring for.
  • Create security guidelines that outline company policy for employees who are caught stealing. Provide a copy to all employees and request they sign a receipt confirming they understood them.
  • Develop human resource programs that build employee loyalty.
  • Make sure company merchandise or property isn’t easy to steal.

Procedural tips

  • Establish controls for petty cash disbursements, bank deposits, withdrawals, issuance of cheques, payrolls, reconciliation of bank statements and payment of invoices.
  • Separate responsibilities and functions so no one employee has sole control over all parts of a given financial transaction and organize workflow to ensure one employee verifies the work of another.
  • Implement a program for regularly scheduled and random inventory checks.
  • Supervise the premises with closed circuit television (CCTV) surveillance. (Be sure to keep in mind any applicable privacy law requirements with respect to surveillance).
  • Check all incoming merchandise against purchase invoices and all outgoing merchandise against shipping documents.

Employing these best practices is great way to deter staff from stealing and protect your bottom line.

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