Thursday 19 September 2019

Caroline McEnery: 'How do I cope with an employee stealing from the company and guard against a repeat?'

Leadership Advice

Weak internal controls can allow staff to steal money, property or goods from their employers. Stock image
Weak internal controls can allow staff to steal money, property or goods from their employers. Stock image

Caroline McEnery

Query: I havead an issue in the past with an employee who stole from the company. I found it very difficult to deal with and I want to make sure that I am better prepared if this happens again. What steps should I take?

Answer Unfortunately, we are asked from time to time for advice on incidents of employees stealing from their workplace.

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Theft can be in many forms, such as stealing money directly from the till, stealing stock or time theft. In the past, some employees have gone to great lengths to avoid detection and have managed to steal large sums of money from their employers before they are apprehended.

These measures include, but are not limited to:

  • Conducting fraudulent refunds and keeping the cash themselves;
  • Non-documentation of sales whereby the money paid never makes it into the till;
  • Credit card misuse, including stealing customers' details;
  • Not scanning goods when serving friends/family members;
  • Taking stock directly from the shelves.

Other actions taken by employees can result in significant loss to an employer. For example, time-wasting when at work (eg surfing the web or taking personal calls), misuse of the clock-in system, abuse of the sick leave policy, and misuse of company property (eg vehicles or phone).

There are a number of clear indicators which can help pinpoint whether your company is at risk. Weak internal controls may provide an opportunity for staff to commit theft or fraud.

A prime example of this is where only one staff member deals with accounts and invoicing. In these situations it would be best practice to implement dual controls within the workplace, eg have a senior staff member sign-off on all transactions and invoices. Absence of clear policies and procedures can result in a lack of standards within the organisational culture. If there is no clear policy in place then staff will not be well informed of what constitutes appropriate behaviour. Poor security measures such as a lack of CCTV, passwords and biometrics provide more opportunities for employees to commit theft as they may be more confident that the theft won't be discovered. Risk of theft and dishonesty can be minimised by taking all reasonable preventative and monitoring measures.


It is important that specific and clear company policies are formulated. These policies must be followed consistently by management and the organisation. The main policy that should be implemented is the 'honesty policy'. This policy should be issued to and signed-off by every employee. The honesty policy should be applied in conjunction with the company disciplinary and grievance policy whereby any employee who is suspected of breaching the honesty policy will be subject to a full investigation.

The honesty policy is designed to protect the majority of people who want to work in an environment in which honesty is encouraged and respected and in which the employee, the employer and customers are protected from any dishonest acts by other employees, customers, suppliers or the general public.

Independent Contact Point

Many organisations now engage an external, independent company to act as a contact point for employees to report any issues under the honesty policy. If you choose to do this in your organisation is it important that you inform your employees of the process involved and how to make contact with the designated liaison.

Culture and Staff Awareness

An open and transparent organisational culture should be established through effective management and implementing organisational policies and procedures to foster this culture.

These policies should be reissued to employees on a regular basis and displayed in open areas such as staff noticeboards and locker areas.

Regular awareness of theft, fraud and dishonesty from all levels is vital to embedding an honest, open culture.

  • Caroline McEnery, Managing Director of The HR Suite is also author of The Art of Asking the Right Questions, a manager's toolkit on all HR-related tips to pro-actively manage your team

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