Modern Retail

Theft in The Workplace: Where the police don’t take action

Theft in the workplace

Theft in the workplace is a fact of retail but it can still be difficult to deal with. There are various things business owners can do to protect their organisation without necessarily involving the police at all. This article will outline what to do if you suspect a theft has been committed, and how to deter thieves in the first place.

What is theft in the workplace?

According to the most recent report from CIFAS, the fraud prevention service, employee fraud is on the rise. In 2014, for instance, recorded internal fraud rose by 18% from the previous year, and 2013 saw a 22% increase in dishonest actions by staff to obtain personal benefit. These increases may stem from the economic and financial challenges facing many in the UK or they may simply be because organisations are not properly protecting themselves.

There are two types of theft in the workplace:

  • Tangible theft means involves items that are physically stolen from an organisation such as equipment, machinery and stock.
  • Intangible theft in the workplace involves the theft of intellectual property like copyrights and trademarks, permits and computer software. This type of fraud tends to be the most damaging for businesses.

According to the National Fraud Agency, theft and business fraud costs the UK economy more than £73bn each year. The increase in cybercrime and the markedly global nature of today’s transactions means this is only set to increase.

How can I investigate workplace theft myself?

It is important that business owners are aware of the laws governing investigations in the workplace. There are a number of resources available online, such as through ACAS. If problems in the workplace do arise, an investigation must be carried out thoroughly. This means that evidence must be collected.

Business owners are permitted, by law, to conduct covert investigations in the workplace, including the installation of covert cameras. There are two laws which may, on the face of it, inhibit such techniques – these are the Human Rights Act and the Regulatory Investigation of Persons at Work Act. However, if a business owner can show that their investigations can be deemed reasonable in the circumstances then these laws actually contribute to your case.

In many cases, however, theft can be investigated through simpler means. If your company keeps detailed records of its inventory, then tracking theft in the workplace is relatively easy. There is software available to assist in this.

Often simply talking to staff and informing them that you are aware of potential thefts will act as a deterrent. Not only does this make loyal staff alert to internal fraud, it may also prevent that fraud from happening in the first place: according to the American National Association for Shoplifting Prevention, 73% of shoplifting crimes in the US are spur of the moment offences. Consequently, an effective deterrent will reduce the likelihood that fraudsters take the chance to commit a crime.

Staff dismissal and why investigations need to be carried out thoroughly

If you decide that a formal investigation is required, it is vital that it is carried out properly. A flawed or incomplete investigation can undermine the disciplinary process and leave employers vulnerable to claims for unfair dismissal.

There are three key criteria an employer must satisfy if they decide to dismiss an employee. The employer must demonstrate that they:

  • Genuinely believed that misconduct had occurred
  • Had reasonable grounds for this belief
  • Had arrived at this belief after a reasonable investigation.

Legally, for a dismissal to be judged fair, an employer must show that they carried out a thorough investigation into the matter before taking action. On a related issue, investigations are also important when dealing with employee grievances because the evidence collected shows the employee that their complaints are taken seriously. An open and honest investigative process benefits everyone.

Prosecuting the Offending Employee

If you decide to take positive action against an employee for fraudulent practice or for simply stealing from you, it may be worth investing in a private prosecution service. Although the police can be a first port of call in many cases, the brutal fact is that they do not have unlimited resources and commercial and business crime, especially when it is internally driven, is not high on their operational agenda. The Police often take the view that the commercial interests of a company do not justify the expense of a thorough investigation and you are in the hands of authorities whose resources are stretched.

Further, if the police are used, the case is prosecuted by the Crown Prosecution Service. For the CPS to continue with a case against a person, it must be satisfied that it is in the interests of justice to take that case on and that there is sufficient evidence to realistically secure a conviction. Of course, what the CPS decide is important in the public interest may not be what you think is in terms of the loss to your business. Whether there is enough evidence to proceed is also dependent upon the quality of the police investigation and how stretched they are in getting the case together. You may be more likely to achieve an effective result, and it may be both cheaper and quicker in the long term, to utilise private prosecution services.

However you decide to proceed, it is important that you take steps to safeguard your business from internally driven fraud. If employees have the opportunity, and if they think that they won’t be caught or prosecuted, then there is a chance that they may steal from your business. But if business owners show that they have robust measures in place, employees are far less likely to turn to crime.

Dave Clough

Dave is an agency consultant and has worked extensively with both law firms and major retailers in the UK. He specialises in digital content, online PR and insight modelling and also runs a reputable music blog.