How to spot employee theft

Posted on April 20, 2011


Employee theft is one of the most common types of retail theft. It can take many forms from sweethearting, short-changing, refund fraud, benefit fraud etc. This type of crime affects all manner of businesses. If it goes unnoticed a single employee could steal €10,000s, leaving businesses even more vulnerable without having to struggle with falling consumer spending. It goes without saying then, that it pays to recognise if it’s happening to you.

Generally employees will steal as a result of three factors. Opportunity (an employee has access to cash or stock goods), Reward (without proper measures the risk of being caught can be very low) & Perceived Grievances (a disgruntled employee will see theft as a means of ‘getting back’ at his employer). When these three factors are present the risk of employee theft rises significantly.

Here we identify some of the signs that an employee may be stealing from your business:

  1. The till is down when a particular employee is on shift.
  2. The till is down on particular days, such as before weekends, end of the month etc.
  3. Patterns in the number or frequency of voids/over rings/refunds.
  4. High number of voids/over rings/refunds from an individual employee.
  5. Customer till receipts are found around cash register area, trash etc.
  6. Sudden or marked change in an employee’s behaviour. A change in a usually good-natured, trusted employee may be a sign of personal issues which in some cases might lead to employee theft. A troublesome employee suddenly becoming eager and helpful may be a front to cover theft and fraud.
  7. Friends or family of an employee visit regularly, but only when the employee is on the till.
  8. Customers hang about the premises at particular times such as change of shift/close of business.
  9. An employee who works in one department regularly spends time with colleagues in areas they have no need to, such as stock areas, changing rooms, till area etc.
  10. Particular employees recently befriending and spending time with security staff.
  11. An employee has a bad attitude towards management, customers, colleagues.
  12. An employee has a lax attitude regarding their work, attendance, appearance etc.
  13. An employee is eager to work late, through lunch or particular shifts when the premises may be quiet or unsupervised.
  14. Employees regularly keep bags/coats/jackets at their work station. These could be used to conceal cash or items.

None of these are proof alone that a theft is occurring however. They are simply signs that owner/managers should monitor. Even if there is genuine reason to suspect theft, it can be extremely difficult to successfully prove than an employee is stealing. To stop employee theft a combination of procedures and technology may be required and it may take some time to prove any wrongdoing..

 3 Steps to Reduce the Risk of Employee Theft:

Procedures: To reduce the opportunity for theft, businesses should adopt effective systems for cash handling, stock taking, deliveries, rosters, refund claims.

Systems: The risk of being caught can be increased with the use of CCTV, till scans, mystery shoppers and undercover investigations.

Communication: It is important for owner managers to highlight to employees the negative impact that theft can have on the business as a whole. Instead of being a victimless crime, persistent theft can put jobs as well as the business at risk. If employees understand the real damage involved, including the threat to their own jobs, they will be much more vigilant towards thefts in the workplace.

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