I think more people than you may think have stolen from their employer on at least one occasion and I have often wondered why we believe it is acceptable.

After all, you would not expect or tolerate, your dinner guests choosing to steal your kettle, cups, pillows, pens, or the games console from your house. So, what is the difference?

What is the cost to a business from employee theft?

I did a little Google research because I know someone somewhere must have asked the same question and come up with an answer.

This is what I found: In 2016, research commissioned by Gareth Jones, Digital Marketing Manager for Kit Out My Office revealed the cost to British businesses of employee theft and theft between employees as £190,422,375. This was based on 67% of respondents admitting that they had stolen something from the workplace. The average cost of the item was £12.50.

Respondents were also asked if they had taken something from a colleague and 41% admitted they had. The estimated value of the stolen personal item was £7.50. In 2016 the Office for National Statistics showed that 23 million people in the UK were employed in an office or had a desk-based job. This means that 15 million workers were stealing from the workplace and the other 8 million who said they hadn’t, in my opinion, were lying (Business Matters, 2016). This survey does not suggest that only office or desk-based employees are the only ones who steal from their employers.

The survey also revealed that 73% of respondents said that they had not been caught. Meanwhile, 27% admitted that they had been caught but 51% of them did not receive any disciplinary sanction, whereas 36% received a formal sanction and only 13% were dismissed. So, on the balance of probabilities, you will not get caught and if you are unlucky to be caught you are unlikely to lose your job or be disciplined.

Why would employees steal?

In my experience of 30 years of policing, some of which involved investigating complaints about police officers, police staff and investigating serious and complex internal disciplinary matters, I have concluded that the common denominators present when employees steal are:

The stolen item(s) or the inappropriate use of the service belonging to the employer is not managed, controlled or audited satisfactory:

  1. The item or service is in an area that has unrestricted access
  2. The employee believes they are justified to take or use the item and are therefore not stealing (I will this cover later)
  3. The employee is a thief and is pre-disposed to steal.

The latter hypothesis will not be covered in this blog, but there are psychiatric blogs that discuss the mental illness of Kleptomania better than I can.

How can employee theft be reduced?

So, what can employers, managers and employees do to reduce the likelihood of theft in the workplace?

Before I explore this in more detail, it now seems fitting to define ‘theft’. I am sure we all know what stealing is, but you would be surprised that it is not as simple as you think. Ask anyone in dispute with an ex-partner about who is entitled to keep a gift now they have parted. For further research, watch a few episodes of Judge Rinder, and then you will understand that theft can be very complicated.

Here is a basic definition of theft from the Theft Act 1968:

A person is guilty of theft if he [or she] dishonestly appropriates property belonging to another with the intention of permanently depriving the other of it, and “thief” and “steal” shall be construed accordingly.

It is immaterial whether the appropriation is made to gain, or is made for the thief’s own benefit.

For the legal eagles out there, I am not going to discuss temporary ownership, the inability to steal land or parts of it, the impossibility of stealing wild creatures or an honestly held belief.

We all know that prevention is better than a cure. This also applies to employee theft. If an employer or manager knows the signs of employee theft, then they stand a better chance of preventing it, or detecting it as soon as it happens.

The signs that an employee might steal

Here are my six signs and reasons why employees steal from their employers and what you should look out for:

1. Unsuccessful promotion or transfer

When a person is unsuccessful in obtaining a promotion or transfer, they can become apathetic employees. They lose interest in their role and the company, become demotivated, have no trust or confidence in the business, no goodwill, no loyalty, and they feel betrayed. Sometimes they feel the need to be compensated for all of their unrecognised hard work, so they make the company pay by damaging property, sharing sensitive information to competitors or committing theft.

To prevent this situation, managers should consider providing detailed feedback to unsuccessful applicants within three working days. A development plan must be created to address the applicant’s areas of development. The employer must show that they value their employee by nurturing their personal development. Consider part or full funding for external training or day release.

2. Their job is no longer available, and there is organisational restructure, mergers or TUPE

When a company goes into administration, liquidation, experiences organisational change, mergers, or TUPE it is a worrying time for all employees because of the uncertainty and lack of job security. Employees will be worried about their wages, unpaid commission (if applicable), redundancy entitlements, the availability of pensions and the likelihood of finding alternative employment. Some may decide to take items belonging to the company because of the probability of receiving a reduced wage, or no wage.

In this situation, all managers, trade unions, staff associations and the HR department must communicate regularly with the employees about the plans and timescales for critical events. The employee engagement strategy must be regular, consistent, honest and transparent about the potential outcomes. Everyone, irrespective of their position in the business, must be kept updated. Don’t forget to communicate with staff who are absent due to suspension, long-term sick leave and maternity/paternity leave.

3. Conflict between supervisor/manager

Any conflict between employees can be detrimental to a company’s performance, and the detriment is magnified when one of the parties in conflict is a manager/supervisor. If the employee is in conflict with their manager, this can give the employee the incentive to sabotage the manager’s performance in many ways. One of these can be theft.

Managers need to be able to identify a conflict with their colleagues and between colleagues at the earliest opportunity and deal with it immediately. Failing to do so could lead to conflict escalation.

Managers need to know their team, treat them fairly, resist favouritism, lead by example, always be professional, dissuade colleagues from gossiping and encourage everyone to voice their grievances professionally.

4. Breaching the psychological contract

The psychological contract is not a written contract but it is just as important as the employment contract because it is an informal agreement between an employer and their employee. The psychological contract is the perceived and real expectations of behaviour between the employer and their employees. It is predominantly based on fairness and equality, so if the employee feels unfairly treated, then the contract is broken and workplace deviance can occur.

Workplace deviances are deliberate actions that are intended to hinder the performance of an organisation. The actions include

damaging working relationships by lying, apportioning blame, gossiping, poor punctuality and attendance, damaging equipment and theft.

Unambiguous policies and procedures need to be in place and widely circulated so that employees understand their rights and entitlements. All policies must be regularly reviewed and updated to ensure that they are fit for purpose and equality impact assessed to prevent direct or indirect discrimination.

Consideration could also be given to scheduling regular team meetings or creating organisational advisory groups made up of representatives from all levels of staff to discuss issues that are causing employees concern.

5. Everyone else does it

The culture of an organisation affects employee behaviour and employee behaviour reflects the organisational culture. Therefore, if the culture is unethical, coupled with poor leadership and inappropriate and unprofessional conduct by senior managers, then you can expect some of the employees to behave similarly. Especially when their efforts are not recognised or valued, and inappropriate behaviour is going unchallenged and unpunished.

An employee is more likely to commit theft if they can justify it to themselves because everyone is doing it. Furthermore, if the company is cheating its customers and providing a poor quality of service, then the employees will do the same to the business.

6. The opportunistic thief

Poor stock control, inadequate security measures and insufficient governance could tempt anyone into becoming an opportunistic thief.

How to avoid theft in the workplace

An employer must have safeguards in place to deter and prevent items from being stolen or misused and adhere to discipline processes to deal with employees who are caught or suspected of stealing or abusing company property. In this category, I include the misuse of company property as vehicles, photocopying, stealing paper, envelopes, pens… this list is by no means exhaustive.

So, here are six reasons why employees steal from their employers and tips on how to deal with or reduce the likelihood, of theft. To be realistic, you are always going to have a percentage of employees, despite all the preventative measures in place, who will steal. In my list, I have not addressed personal issues such as mental and physical health, financial and personal relationship problems.

If you identify or suspect, that an employee has stolen or misused company property, then despite the irrefutable evidence or belief, discipline policy procedures still have to be followed to prevent litigation and expensive legal costs. You are always vulnerable if you have not followed policy or have not secured and preserved evidence correctly.

Need help to deal with theft in the workplace?

If you want to know more about protecting yourself from litigation and dealing correctly with discipline and grievance matters, contact CMS for a free consultation – call 0121 573 0252

CMS will take the pain away while you run your business.

Brian Carmichael