Dealing with Employee Theft
Internal theft is one of the biggest causes of loss in the retail industry. It’s awful to think that one of your employees would steal from you, but unfortunately it does happen. According to Retail Ireland, 39% of Irish retailers have experienced theft of stock by employees. If you catch an employee stealing from your store, it’s only natural to feel betrayed and your gut instinct is probably to fire them. This is a bad idea. While it seems clear cut that if someone is stealing, they should be fired, it’s important to follow the proper employment disciplinary procedures. The last thing you want is to end up paying a settlement to someone, who has already cost you a lot, because of a claim of unfair dismissal. Unlike a legal procedure where you must prove beyond reasonable doubt that someone is guilty, thankfully employment investigations only need to prove that an employee probably committed theft (SIPTU explains more on this in their article here). However, when dealing with employee theft you must use fair procedures to avoid a claim of unfair dismissal.
Contract of Employment & Staff Handbook
One thing that’s important for all employees starting with your business is a Contract of Employment. This contract should clearly outline the terms and conditions of their employment (such as the probationary period). Both it and your Staff Handbook should outline your disciplinary procedures. Both these pieces of documentation are very important for you as the employer. A probationary period can give you a chance to see if the employee is a good fit for your business and gives you a chance to notice any major issues. The benefit of this period is that if any such issues are discovered employees don’t have to be kept on. The disciplinary procedures outlined in your Staff Handbook serve as a guideline, for both the staff member and the employer. This ensures a fair, unbiased and systematic series of steps in the case of a problem, such as the discovery of theft. Having these steps in place and following them in any dismissal case is crucial.
As part of the disciplinary procedure you may have an investigation process. Carrying out a disciplinary investigation even in cases where there’s been an admission of guilt or an abundance of proof, is a vital part of effectively implementing the disciplinary procedure. This investigation should take place before any correctional action to ensure fairness and justice which stands to you if ever brought to a court of law. You need to be able to prove you have justifiable grounds based on solid evidence, before dismissing a member of staff, so that you are not dragged into a claim of unfair dismissal or a costly legal battle. This is why thoroughly completing an investigation into the apparent transgression is crucial.
Staff Search Policy
It can seem extreme but having a staff search policy in your Employee Handbook can be a good preventive measure. Having a ‘Right to Search’ policy in place is a perfectly legitimate way to gather proof of theft. However, if this policy is not outlined in the employee’s Contract of Employment and your Staff Handbook, then a staff member is completely within their rights to refuse to submit to a search without any repercussions. If you don’t have this policy as standard in your business, you should introduce it now.
The most important thing to remember is to follow procedure! Having the right policy and procedures in place mean nothing if you don’t remember to actually follow them. You should also ensure that you give the staff member the chance to refute allegations and defend themselves. The employee has a right to review and respond to any evidence you are relying on. Don’t forget that employees are entitled to be accompanied to any disciplinary meetings and to appeal any disciplinary actions.