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Employee Theft – Don’t Get Caught Out

New research from Investors In People (IIP) suggests that more than half of hospitality employees (65%) are currently unhappy in their jobs and considering a move.

Such startling statistics are worth considering if you are the owner or manager of a business. Research shows that unhappy employees are more likely to cause harm, disruption or ruin reputation than those who are happy in their working environment.

NDML offer some simple, yet effective advice for discouraging employee theft.

Recruitment: If possible hire from within so you are familiar with the candidate, failing that seek recommendations or extensive past experience. Interview thoroughly, gain references and get a second opinion.

Physical Security: Consider a company in which doors are regularly left unlocked or sensitive financial information is not secured – you are inviting employees to take advantage. Make sure all entrances and sensitive doorways are locked and monitored. A key card system is more favourable than traditional keys for recording access.

Install a good quality safe. Be sure it is fireproof, securely anchored and kept in plain view. The combination should be changed when an employee who had access, leaves your business. The keys to the safe MUST be removed from the premises out of business hours or placed within a locked safe or strong room – the keys to which are themselves removed from the business premises.

Keep a virtual eye on employees: People are less likely to steal if they know they are being watched. A video surveillance system helps deter employees as well as catch theft after it happens. Be sure to include cameras in storage rooms and loading areas as well as in public areas. Use high-definition video so you can clearly identify employees and transactions. Limit the access to your surveillance systems to as few people as possible to avoid tampering. Most local police authorities recommend keeping CCTV footage for a minimum of 14 -31 days.

Another way to keep an eye on your employees is to use an exception-based reporting system at your point of sale to flag possible fraudulent transactions e.g. excessive refunds or voids (ideally managers should be responsible for voids and refunds but at the very least they should be witnessed by a second employee.) Review POS several times a week to determine if there are any issues that you need to look into further. Implement surprise audits and regular reconciliations, these might include surprise cash counts. The procedures don’t have to be elaborate. If employees know their work could be checked at any time they are more likely to be honest and accurate.

Use the buddy system: Often theft happens when one employee is left alone, NDML recommend having two employees working at all times. Rotate the employees paired together and avoid having close friends working the same shifts.

Monitor your rubbish! Employees often steal money/merchandise by concealing it in rubbish bins then retrieving it later. NDML recommend putting controls in place to reduce the opportunities, such as using clear rubbish bags, flattening all boxes and locking refuse areas.

Utilise your workforce: Set up a confidential way for employees to report co-workers’ suspicious behaviour. People are less likely to steal if they know they are being watched.

Get to know your employees: It’s much easier to steal from someone you don’t know than from someone you do. NDML recommend getting to know your employees and being aware of their personal and financial situations. Financial difficulties or high levels of stress increase the impulse to steal.

Discipline: Dealing swiftly with theft communicates to employees that management take the issue seriously. An internal discipline policy should be developed and communicated to employees. Make them aware of the range of disciplinary options, from a verbal warning to a written warning to a suspension or dismissal.

Common sense: Minimise the amount of cash you keep on the premises. Make frequent pick-ups of money from tills and regular bank deposits. Keep valuable items locked out of easy reach.

From an insurance perspective, Fidelity Guarantee cover can provide an indemnity should you suffer a theft of money or goods by your employees (subject to the terms and limits of your individual policy). Ask our experts for advice or visit Fidelity Guarantee for more information.

By | 2016-12-01T11:50:21+00:00 February 16th, 2015|Articles|0 Comments

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