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Employee Theft

Employee Theft

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Published by Asjad Jamshed
employee theft
employee theft

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Published by: Asjad Jamshed on Jan 14, 2010
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Employee Theft
EMPLOYEE THEFT
Billions of dollars are lost and stolen annually from businesses, because of employeetheft. Employee dishonesty and theft costs businesses over $50 billion dollars annually. National estimates show that 75% of all employees steal from their employers at leastonce throughout their careers. The same statistics show that at least half of these 75%steal multiple times from their employer. It is plain to see that the businesses cannotcontinue to function if they let employees steal from them.The intent of this article is to give supervisors and business owners a better understandingof employee theft. We will first be defining employee theft, next we will reveal thecauses of employee theft, then state the facts about employee theft and finally suggest themeasures that should be taken to prevent employee theft.
Definition:
Employee theft – any stealing, use or misuse of their employer’s assetswithout permission to do so.To further add to this definition it is also important to point out what employees normallysteal from their employers:
 Money
Money is one of the most common assets that are stolen from employers.
Theft of time
Theft of time occurs when an employee is paid for time which they did not work. Usuallythis happens through the falsifying of time records. Technically theft of time can alsoinclude employees who are not working while on the job, though legally this is moredifficult to prove.
Theft of supplies
Theft of supplies is another prevalent form of employee theft. Common examples of thisform of theft are office supplies (paper, computers, cabinets, etc.) and restaurant supplies(food, condiments, silverware, etc.).
Theft of merchandise and company property
Theft of merchandise refers to products that are to be sold. A good example of theft of company property is product displays.
Overcharging customers and then pocketing the extra cash
This can drastically affect a business’ reputation, because it affects not only the employer  but the customers as well. If the customers find out that a business is overcharging themit can hurt that business’ public relations. This is very common in restaurants becausemost private restaurants do not keep a close eye on their employees’ actions.Institute of Management Studies, University of Peshawar.1
 
Employee Theft
 Information
This is probably the most damaging of all the forms of theft that were mentioned earlier.Common examples of this are theft of product design and trade secrets. Businessesshould be fully aware of how theft of information can cripple their business operations.
Causes of Employee Theft
Amazingly, employees questioned as to why they stole often rationalize their action andstate the opportunity of theft presented itself through lax policies, controls andmanagement indifference. Moreover, many employees cite opportunities created bymanagement, not their financial need, as their primary motivation to steal. Anothesignificant reason employees give for stealing is their perceived belief management wasstealing so it was okay for them to also do so. This condition proves the point that, if management wants a theft free work environment, it must set the example of honesty andadherence to policies.Some other common examples of employee rationale for theft include:
I am underpaid and I only take what I deserve.
Everybody does it, besides, they can write it off.
The company makes a large profit and I deserve some of it.
The company angered
me and I got back at it.
Rarely do most employees steal from their employer because of need. Thefts usually because an opportunity to do so has presented itself. It stands to reason that an employeewill only steal from their employer if the chances of getting caught are low.There are many other basic reasons why employees steal:
Low morale at the workplace. This is also a major reason why businessessuffer from low production.
The employee feels that the business or company has wronged or mistreatedthem in some way.
The employee feels that they are underpaid [and under-appreciated] for the"hard" work they do.
The consequences for theft are minimal. The company has no punitive procedures or policies regarding employee theft. If there are no setconsequences to employee theft then employees will continue to steal, because they think that they won’t be punished.
Lack of control over inventory. It is easy to steal because the employer doesnot have preventive measures to stop them. Preventive measures are crucial toreducing the risk of employee theft. If preventive measures are not existentthen the opportunity to steal is very high.
Facts about Employee Theft
Since there are as many signs of theft as there are ways to steal the list of warning signs isendless. The key is for management to realize that certain conditions or incidents may not be the result of carelessness or incompetence, but indications that theft is in progress. Allirregularities or deviations must be evaluated with an open mind and creative mind.Inventory or product found near employee exits or dumpsters, sensitive documentsInstitute of Management Studies, University of Peshawar.2
 
Employee Theftdiscovered in copy machines, employees in key positions who refuse to take time off, photo-copied documents used in lieu of originals have been signs of past theft and may be indications of existing dishonesty.Some other facts about employee theft are as follows:
A majority of employee theft goes undetected by supervisors and management.
Opportunity remains the leading cause of employee theft.
Employee theft is responsible for 33% of all business bankruptcies.
Other employees often ignore the theft and don’t do anything about it. Employersshould not count on other employees to report employee theft, unless they can puta system in place that keeps the "reporter" anonymous and/or a reward program isset up.
Employee theft is prevalent in every type of business.
Business owners must be aware of these facts in order to detect employee theft. Itis a common fact that most employers do not suspect their employees of theft.Another fact that is important for owners and supervisors to keep in mind is that themajority of the people who are stealing are those who have a close relationship with their  boss.With reference to A Report to Business from the Baltimore County Police Department published in
 
April 2002 some interesting facts regarding Employee theft are illustrated below with the title, 
“WHO DO YOU TRUST? BEWARE OF EMPLOYEE THEFT!”
Let's play true or false based on a study done by the Department of Commerce and theAmerican Management Association
.
1.Most theft is caused by non-employees.
False.
Quite the opposite. According toJohn Case, a security management consultant, 95 percent of all businesses areaffected and hurt by employee theft.2.Well-paid employees or senior employees are trustworthy, loyal and don't steal.
False.
Oftentimes these employees are the most dangerous because they takeadvantage of the trust that has been placed in them. These employees areopportunists, that is they steal when the opportunity is right and not always for financial reasons. They feel little remorse because they believe that insurance willtake care of the loss. Or maybe an individual feels they deserve it because they arenot paid as much as they think they are worth.3.Honest employees can be counted on to report employee theft.
False
. Even honestemployees may feel strange about reporting on a fellow employee.4.Employee theft is easy to spot.
True.
Depending on how vigilant you are.Management must keep track of inventory. If merchandise is found near a dumpster or exit, chances are it didn't get up and walk. Someone had to have put it there. If you notice sensitive paperwork in a copier or copies used instead of originals, that isalso a sign that something may be wrong. Don't delay - check out these situationsimmediately.Institute of Management Studies, University of Peshawar.3

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http://www.ifpo.org/articlebank/emplo... Has the same works as the first half as this paper. Someone should check for copyright.
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