I suspect an employee is stealing. What can I do?

Ben Stepney recently wrote a piece for Construction Management advising on best practice if you suspect an employee of theft.

Theft in the workplace can affect companies of any size, in any place. UK businesses lose approximately £190 million every year as a result of employee theft.

Employee theft can extend beyond physical property such as cash, stock or other tangible items; it can also include personal/business data or other intangible commercially sensitive information.

What can you do if you suspect an employee is stealing?

Employers have a legal right to launch an investigation if they suspect an employee of theft in the workplace. However it is important to remember that the employer holds full responsibility for the manner and fairness of this investigation. Employers may opt to appoint an external investigator or, if it is more appropriate, someone within the office. If there are existing policies in place governing how the issues should be dealt with by the employer, these must be strictly adhered to. A flawed investigation may undermine the disciplinary process and may ultimately leave employers vulnerable to employment claims including for unfair dismissal.

If, following the investigation, the suspicion holds no ground then no further action should be taken. However, if there are grounds to suspect the employee of theft and the issue cannot be resolved informally, then the employer should invite the employee to a disciplinary hearing. For more information on the steps to take, see this helpful ACAS article (https://www.acas.org.uk/disciplinary-procedure-step-by-step/step-4-the-disciplinary-hearing).

Is theft from work a sack-able offence?

Employee theft is commonly considered an act of gross misconduct, which is usually a lawful ground for dismissal without notice (or payment in lieu of notice), however the consequences of stealing will vary on a case by case basis, depending on the offence and the evidence available. If the employer has sufficient evidence from the investigations carried out, they should consider suspending the employee before they conduct further investigations.

In order to discipline for theft, the employer must demonstrate the following:

1. that they genuinely believed that misconduct had occurred;
2. that they had reasonable grounds for this belief; and
3. that they had arrived at this belief after a reasonable investigation.

An employment tribunal will then look at whether a sanction of dismissal was ‘reasonable in all the circumstances of the case’.  As such, when the employer considers dismissing, they should consider factors such as:

1. whether the disciplinary policy list theft as an act of gross misconduct (most will);
2. the employee’s previous disciplinary record;
3. length of service;
4. the attitude of the employee; and

What about mitigating factors?

It is important to take active steps to safeguard the business from internally driven fraud. If an employee discovers they are unlikely to be caught or prosecuted following theft, they may be more likely to steal from the business. Conducting surprise internal audits can be a helpful tool to detect workplace theft as they help to prevent established fraudsters from memorising the company’s audit schedule.

Preventative measures should be adopted and may include the installation of CCTV (remember that employers are allowed to use CCTV if it is for legitimate business purposes, but they must comply with all applicable data guidelines and legislation).  If theft of intangible assets is a particular concern, such as confidential business information or intellectual property, consider reviewing the company security and enhancing the access permissions.

Employee theft may not be completely avoidable, but there are effective steps employers can take in the workplace to minimise the risk, including the implementation of workplace theft policies (remember it is the employer’s duty to make employees aware of policies in place).  This could cover procedures for handling cash, inventory and equipment, and should set out the consequences if an employee is caught breaking the rules.

If you have any questions about this topic, please get in touch info@ts-p.co.uk