Historical studies of employee theft suggest a general “10-10-80” rule of thumb. This proposes that 10% of employees will never steal, 10% will always steal, and 80% could go either way depending on circumstances and opportunity.
While the culture and example set at any company will influence the 80% when facing a decision, there are also effective theft-prevention measures to use that go beyond principles:
- Hire people with proven track records
- Educate and train employees
- Set clear policies
- Divide tasks among employees
- Inspect and Audit
- Know the usual schemes
- Look for the signs
While the first items on the above list reflect directly on personnel decisions and policies, a business owner or executive may place as much value on the last two which put the onus on management to carry out. Knowing where and what to look for is critical in the prevention and detection of employee theft. Here are the most common assets stolen by employees:
Even with sound policies and exemplary values, employee theft is bound to occur. How a company and its management respond to occurrences of theft can make or break the sustainability of the business. There are lawful methods of gathering evidence. Protecting a witness or whistleblower may be necessary if criminal charges are sought. Decisions regarding employment, rehabilitation and restitution must be well thought out.
As much time and effort given to a business’s development and budgetary planning could also be spent on strategies to protect against employee theft. Employee theft can have as much effect on profitability as any other component of a business. Sound preparation for preventing, deterring and responding to theft provides an employer with the greatest overall protection, whether that’s measured in tangible dollars, shareholder and consumer confidence, lost time and production, or just simple peace of mind.
Contributed by Matt Vicari and Bill Fallon, Attorneys at Law, Miller Johnson.