subject: Employee Theft: Facts and Prevention Tips [print this page] Employee theft is a disturbing crime that causes more damage to a store's profits than shoplifters. Not only are merchants paying for the cost of employee theft, they're also forking out employee wages and benefits to the callous thieves.
Today's unsettling statistics reveal the cold, hard truth about employee theft:
In 2009, retailers suffered a total retail loss of $33.5 billion.
Employee theft comprised 43% of total losses.
Shoplifting comprised 35% of total retail losses.
With employee theft accounting for $14 billion in retail losses, this makes deceitful employees the largest single threat to a store's profits and success.
Employee Theft Defined
To an employer, employee theft is when an employee steals store merchandise, money, or property while on the job. From a legal standpoint, theft is committed when the employee takes something with the intent to deprive the merchant of the stolen item's value.
Employee theft occurs when an employee conceals store merchandise and carries it out of the store without paying for it. An employee may also steal cash; assist a friend or another employee to steal an item; eating food for sale by the store; or by committing fraud with the use of a credit card, check, or refund.
Regardless of the method, each deceptive act of employee theft leaves businesses with a loss of inventory or profits.
Employee or Thief?
It is very difficult to separate dishonest employees from honest employees. Those who commit employee theft vary in sex, age, ethnicity, economic status, and education. An employer cannot determine which employees pose a theft risk based on demographics alone. The only way to determine which employees are the bad seeds is by paying attention to the history, conduct and overall behavior of each employee. An employee's past job history, conduct, judgment, and responsibility usually lays the foundation for what an employer can expect from them in the future.
Opportunities to steal merchandise and cash are available to store employees throughout their work day. So all it really takes on the employee's side is some form of motivation or desire to carry out the theft. What separates the honest employees from the dishonest employees is their respect for the law, loyalty to their employer, and personal values and integrity. Studies have shown that stores with few part-time workers and minimal employee turnover have the least amount of losses in merchandise and profits due to employee theft.
For some employees, the only thing that stops them from stealing from their employer is their fear of being caught. When an employee steals, they risk losing their job and serving jail time. In some cases, the presiding judge may request financial restitution, fines or legal fees. This can leave an employee with a criminal record and a black mark on their job history for several years. Studies have shown that employees who choose to steal from their employers believe they can get away with the theft without getting caught.
Prevention Tips
To successfully prevent or reduce the occurrence of employee theft, employers must increase the risk and reduce the benefit of stealing for employees. To do so, a retailer's loss prevention plan must include methods of operation that help reduce the motivation, desire and opportunity to steal, as well as increase the risk of getting caught.
The following are a few tips that can help employers reduce losses due to employee theft:
Install security cameras and hire security staff for the sole purpose of monitoring employees and shoppers for theft.
Display a solid commitment to preventing retail losses and keeping an eye out for thieves. Taking a zero-tolerance stance to store theft conveys to employees that preventing theft is a top priority of the employer and every thief will be prosecuted to the fullest extent of the law.
Devise hiring, training, and monitoring procedures for employees and managers around your loss prevention plan. Procedures that are clearly defined, communicated, and executed in their entirety can significantly reduce an employee's desire, motivation and opportunity to steal.
Set up an award system that provides special acknowledgement and/or compensation to employees or departments with the lowest retail losses each financial quarter, semiannually or annually.
