Employee theft expected to rise post Covid-19

A little context

After both the Global Financial Crisis and September 11, retail crime in the US increased. That was largely due to tough economic conditions and lower employment rates, which saw some people turn to crimes of opportunity in order to make a little cash on the side.

Loss Prevention Magazine previously noted shoplifting and Organized Retail Crime were among the areas likely to see a spike. Now they also predict retailers may additionally have to deal with greater instances of employee theft.

They note that’s due to several factors, including:

• Staff hours being cut

• A reduced retail focus on loss prevention and fraud controls

• Staff feeling owed for their contribution

“After the financial crisis in 2009, most businesses reported that employee theft increased—in both number of incidents and amount per incident—compared to the year prior to the recession, according to a survey by the Association of Certified Fraud Examiners (ACFE),” LP Magazine reports.

“In one typical case, four employees of a home improvement retailer were caught conspiring to defraud the company in a vendor kickback scheme. In a weakened economy, the threat of fraud rises, ACFE analysts concluded, and ‘employees pose the greatest fraud threat’.”

Zero tolerance

Between staff layoffs, Covid-19 social distancing and a push to see retail gear up after the pandemic, staff may get the sense a retailer’s eye is not quite so firmly focussed on loss prevention and employee theft.

Now’s the time to educate and illustrate that’s absolutely not the case, ensuring staff members are aware:

• There are checks and balances in place

• Theft is everyone’s problem, affecting the viability and profitability of a retailer, and therefore job opportunities

• Instances of theft will be pursued and prosecuted where necessary

Staff education and screening

Proper employee screening goes a long way to reducing the likelihood of employee theft. All employers should ensure new staff members are effectively vetted and screened by conducting interviews, checking them on the internet and contacting previous employers along with referees.

Meanwhile, ongoing education and the culture of an organisation also play a role. Staff should be educated with clear policies and procedures on day to day operations.

In doing so, retailers should foster a positive working environment where employees are treated fairly and with respect to ensure there are fewer or no incidents of stealing out of revenge.

Monitoring

Whether it’s CCTV, the reporting features on the mobile Point of Sale, or general supervision of staff by management, monitoring plays a key role in reducing employee theft.

Monitoring all levels of a store ensures management is aware of gaps in staff knowledge, customer service improvements that can be made and potential security threats which might make a retailer more prone to employee theft.

Technology

Whether it’s CCTV, the reporting features on the mobile Point of Sale, or general supervision of staff by management, monitoring plays a key role in reducing employee theft.

Monitoring all levels of a store ensures management is aware of gaps in staff knowledge, customer service improvements that can be made and potential security threats which might make a retailer more prone to employee theft.