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How to Confront Employee Theft

January 10, 2016 by  
Filed under Blog

Employee theft, regardless of its form, can be a difficult situation to deal with. While indicators such as, inventory shortages, variances in cash balances, missing equipment and tools, can signal towards the possibility of employee theft, it is always challenging for a company to handle them appropriately. However, proper handling is crucial; it decides whether your company faces litigation or not. It also helps you save thousands or millions of dollars in losses, depending on the size of your business, and extent of theft. So what is it that you need to do in order to deal with this situation? Let’s find out:

Stick to Policies

When dealing with cases of employee theft, an employer needs to be mindful of the state and federal laws that may be governing the process. Particular methods of documenting and investigating employee theft can expose the company to litigation. Instances like rummaging through an employee’s purse without consent, or placing hidden cameras for surveillance of the suspected employee can result in liability. If you are installing surveillance cameras, your employees should know and acknowledge the fact. You may ask them to sign a form in which they acknowledge that theft is a crime that the company does not take lightly. Have clear policies about things that are and are not permissible, and make sure your employees are aware of those policies.

Choose Your Words Carefully

The word ‘theft’ itself is a choker; if used in the wrong situation it would make the knot of a defamation claim, litigation, or something much worse, tighter around the neck of your company. It is always better to use ‘violation of company policy’, or ‘mishandling of cash’ as accusations rather than the word ‘theft’.

How to Proceed

You’ve had the case investigated, and you know the employee has been involved in stealing; what should you do now? Follow the steps listed below:

  1. Gather evidence. Remember you need to having strong proof of the accusation you are about to make. Videos, documentation (summaries, financial records, emails, etc.), witnesses, investigative report, and anything else that basically backs your claim. Make sure you have the evidence complete and properly preserved.
  2. Your first instinct would be to terminate the employee, do it by the rules defined in your policies. Do not overlook the contracts, notifications, collective bargaining, or any other processes that form a part of the termination process.
  3. Report to the police. You would need a police report if you wish to avail your theft insurance coverage.
  4. It is always safer not to deduct anything from the final paycheck you issue to the terminated employee; however, if you wish to, make sure you thoroughly go through the state regulations governing the situation.
  5. Never discuss the matter with outsiders, or other employees of the business.
  6. If the employee wishes to leave immediately when you terminate them, have someone inform the police. You can also hire external help to escort them outside the premises in case you are concerned about your workplace safety.

Before you make any accusations, it is important that you have your homework done. If you’re having trouble in finding the culprit, we suggest you hire special investigative services to conduct theft investigations on your behalf. Check out our range of investigative solutions, or just give us a call at 800-960-6748.


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