Reduce Employee Theft in the Workplace

Admit it. You never think twice about pocketing a pen or taking home a pad of Post-it notes from work. Companies, especially larger ones, buy these things by the gross. They’ll never miss it, right? Wrong. Employers may lose up to 37% of their profits to “shrinkage”, including employee theft. This runs into the billions of dollars annually. Retailers are especially vulnerable, not only from shoplifters, but employees as well.


So where do we draw the line? Pens? Well, everyone knows that companies expect people to pick up pens, and that in reality, pens are a form of advertising to be given away. The definition of employee theft should be clearly defined for your employees to avoid assumptions and confusion. Many employees feel they are entitled to bring home the tools of their trade, especially if they are tasked with telecommuting, working from home or working off-site.  It’s very important that all new hire training include a conversation about employee theft and the policies, procedures and security measures your company has in place to control loss and discourage theft. You may look the other way under a certain dollar amount, but you need to control loss of higher prices items such as electronics, or tools. You don’t want to create an atmosphere of suspicion, but to make it abundantly clear that you as the employer will not tolerate any kind of infractions in this area. Theft is a firing offense. Employees should be made to sign off indicating they’ve had this training and understand the consequences should they steal from the company. Encourage employees to alert management if they become aware of theft in the workplace. Those employees should have no fear of retaliation.

Security measures

Each company has to look at its employees and their needs vs. access to the company  assets and office supplies. You want your employees to have the things they need to do their job, but limit them to those tools or supplies. For example, if  you run a mechanic shop, you might require all mechanics to have their own basic set of tools, and anything else they may request must be managed through a central location and signed out or checked out by the individual with a deadline to return.

Security cameras in supply areas are an excellent investment to control employee theft. Post signs that indicate your employees are under surveillance in these areas and make certain that employees have permission to enter these areas from supervisors or managers. All items of value such as radios or laptops should have security tags and serial numbers registered. They should be engraved (no removable tags) with an identifying mark that signifies they are company property. They are assigned to employees as needed and employees are required to sign for these items and return them at termination of job duties. If the items are not returned, the value of the item is deducted from the employee’s final paycheck.

Inventory control

Strict ordering and tracking procedures ensure loss control. This should be an assigned task to a single employee who is solely responsible for ordering, stocking and tracking inventory. Whenever something leaves inventory it must be signed for by the employee and the inventory control person. This person must report to an upper management staff member. The best way to avoid high dollar losses to the company is to tightly control supplies and electronics. Keeping clean and clear records of these transactions will ensure that employee theft is kept to a bare minimum and employees understand the impact of their actions on the company’s bottom line.


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