Adopt these Safeguards to Prevent Worker Theft | DCR Workforce Blog

Adopt these Safeguards to Prevent Worker Theft

It has been reported that nearly 95% of workers steal from employers. Do you count yourself in that number? Is it possible that we are a nation of thieves? Of course, we are not talking about great big embezzlements running into tens of thousands of dollars. However, when we consider the various types of thefts that occur, you may find that you have to count yourself among the guilty.

Pilfering of office supplies and improper use of office equipment for personal purposes cost companies money, and are a form of theft. The cost of lost office supplies like pens, erasers, paper or staples aggregates to a few billions of dollars when totted up across the economy.

According to statistics:

  • 52% confessed to using the company’s printer for personal work or took home USB drives and computer accessories.
  • 30% either falsified their own time records by having a co-worker clock them in or out; or recorded wrong times by other means.
  • Nearly 80% of workers plead guilty to using office computers or phones for personal use when at work. This is referred to as ‘time theft’.
  • 18% committed the ultimate offence of stealing proprietary business information, client lists and marketing lists.
  • Another survey reveals that businesses lose about 5% of their total revenue to fraud and embezzlement, and this loss amounts, every year, to a whopping $3.5 trillion globally.
  • 87% of the employees who were caught were first time offenders, making one wonder if all the credit checks and background screenings which employers undertake prior to hiring a worker are of any real use.

While it may be safe to assume that the retail industry is most severely affected by theft, you may be surprised at the Adopt these Safeguards to Prevent Worker Theftsource. Employee theft far exceeds shoplifting. The National Retail Federation’s survey in 2011 found that 43.6% of losses in the retail sector, amounting to $34.5 billion, were on account of employee theft. In 2012, another research group found that one in 40 workers at the 23 major retailers surveyed was apprehended for theft.

Not all businesses may offer as much opportunity for employee theft as the retail industry but all businesses big and small face this scourge. How does an employer or manager accuse a worker or colleague of theft? It is a problem of mammoth proportions, and can take so many forms that it becomes very difficult to even determine its existence.

Companies who wish to avoid employee theft usually believe that their hiring parameters are sufficient to help them choose the most suitable candidates for a job while weeding out workers with questionable and unwanted characteristics which could spell trouble later on. While hiring carefully is important to achieve this goal, employers may also consider adopting other measures to safeguard themselves.

  • Establish and communicate clear policies regarding the use of office equipment or time for personal activities. Apply these policies consistently. Under what conditions will you allow personal phone calls, internet browsing, or related activities when at work?
  • Use background checks where warranted. Make sure that these checks are compliant with the stipulations of the applicable Equal Employment Opportunity Commission for your location. We find it ironic that most companies insist on background checks and drug screens when using contingent workers, but do not routinely apply that requirement when hiring permanent employees.
  • Use character references carefully to understand more about the applicant and to conduct a due diligence enquiry into the applicant’s background.
  • Use security cameras and adopt surveillance measures to carefully monitor workplace activities.
  • Adopt better processes for signing in or out, and verify the effectiveness of these processes.
  • Re-examine you approach to provisioning workers. Establish controls that ensure that workers can only access the tools and equipment needed for their specific roles and responsibilities. Track what has been provisioned – including system access, and be sure that you everything is returned and system and facility access is cut off on the worker’s day of termination.
  • Keep an eye out for signs of misconduct. When a worker shows traits like refusing to take vacations and is overly protective of their workplace and/or work, you may be dealing with a very dedicated employee. Then again, this may be a telltale sign of fraudulent behavior by someone on the team.

In addition to the “hard costs” associated with worker theft, companies also suffer from the impact on worker morale. Conscientious workers often complain about supervisors who routinely ignore worker violations. They feel ill-treated when others are allowed to come late or leave early. They notice when co-workers inappropriately use corporate equipment. The messages being sent to the workforce is that the company’s policies are merely guidelines that can be ignored when convenient, and that double-standards are tolerated. Consistency is key!

So, are you counted among the 95%? If you are in a supervisory position and fail to act when you suspect that your workers are violating company policy by helping themselves to company resources, then you definitely are part of the problem!

Tell us what steps your company has taken to reduce employee theft. Share your thoughts on what can be done. We’d like to hear from you.

The content on this blog is for informational purposes only and cannot be construed as specific legal advice or as a substitute for competent legal advice. They reflect the opinions of DCR Workforce and may not reflect the opinions of any individual attorney. Do contact an attorney for advice specific to your issue or problem.
Lalita is a people/project manager with extensive experience in operations, HCM and training and development across industries like banking, education, business consulting, BPO and information technology. She believes in a dynamic approach to life and learning as change is the only constant.