To manage staff effectively, it is important that employers have policies in place to tackle the more challenging aspects of employee management, such as workplace conflict, violence, theft, and fraud.
Employee theft is a serious staff management issue that employers must take proactive steps to prevent. This blog discusses employee theft, termination related to employee theft and how to address theft in the workplace.
What does employee theft include?
Employee theft is when an employee steals from the employer, but it includes more than just stealing cash or pilfering office items. Misuse of company assets without permission or stealing sensitive information are also instances of employee theft. These assets can take various forms, such as:
- Information: When an employee steals business secrets, data, classified company documents or product designs
- Time: When an employee fabricates their hours worked and get paid for hours they did not work
- Office supplies/company property: Pilfering small office supplies, such as notebooks, pens, staplers, punching machines, to larger items, such as laptops
- Money: Cash theft may happen in several ways. The employee may skim or take out cash from registers or overcharge a customer and pocket the difference
Although businesses of all sizes face employee theft, this issue is especially difficult for small- to medium-sized companies. Smaller infrastructures often translate to fewer anti-theft controls and less resources for financial cushioning.
Theft also has a negative effect on company morale through broken trust, and often results in the employer increasing security measures in the workplace (such as, identification badges, surveillance cameras and restricting employee access to company materials, such as office equipment and supplies).
Can an employer fire an employee for stealing?
Yes. But you must have clear and convincing evidence of the theft to be able to dismiss the employee for just cause. Termination with cause is the most serious form of termination.
Employers can terminate an employment for just cause when an employee commits a serious act of wilful misconduct/breach of contract (such as, stealing, assaulting a co-worker, or committing fraud).
While a serious act of misconduct like workplace theft may seem to justify termination, it is always best to proceed with caution when determining the appropriate level of disciplinary action. Where courts have found that cause for dismissal on the basis of dishonest conduct, such as theft, exists, the analysis rests on looking into the nature and circumstances of the misconduct to determine if the dishonesty is severely fraudulent in nature to justify termination without notice.
It is a good practice to have an escalation process when it comes to disciplining staff for theft.
How to address theft in the workplace?
You should follow a proper procedure when faced with employee theft. We recommend that you:
Complete a formal investigation
Obtain all evidence that supports your allegation. A proper investigation includes:
- Collecting written evidence (i.e., bank statements, stock reports, etc.)
- Collecting any security footage that supports your allegation
- Interviewing co-workers who may have been witnesses to get witness statements
Meet with the employee
This meeting is to present your evidence and gather the employee’s response. Proper scheduling of this meeting includes:
- A written meeting invitation to the employee
- Providing at least 24-hour notice of the meeting
- Allowing the employee to bring a support person
Make a decision
After hearing out the employee, you can make an informed decision regarding the employee’s future in your company. If you can objectively prove this employee committed theft, you may have grounds to terminate their employment.
How to prevent employee theft?
While it is not possible to foresee fraud or embezzlement in the workplace, you must put in place checks and controls to prevent theft. Besides setting workflow procedures that ensure accountability and surveillance cameras in sensitive areas, you must have clear and comprehensive policies on discipline, confidentiality, theft, IT and email, privacy & data protection, etc.
Do you need help with staff management?
Handling employee theft incorrectly could expose you to litigation. Peninsula’s experts can help you navigate employee theft in compliance with the law. We’ll help implement policies on workplace theft or update your existing ones to prevent theft in your organization.
Whether it is company policies that you need assistance with or any other HR, health & safety, or employee management advice, we’ve got you covered. To learn more about how our services can benefit your business, call an expert today at 1 (833) 247-3652.