Knowing that someone is stealing and knowing precisely who is stealing are two very different things. Resolving employee dishonesty is vital to the health of your business. But, equally critical to ensure that the attempted resolution does not create greater legal or employee relations. Professionally resolving employee dishonesty ensures the resolution costs do not become more significant than the theft.
Companies and businesses enjoy some latitude in the methods they can employ when dealing with a dishonest employee.
For example, there are several Supreme Court cases related to employee theft and employer rights in resolution. In addition, various state and labor laws also cover this topic. Bear in mind, however, that there are limits and protections afforded to employees.
Consequently, it is always best to understand the laws related to specific circumstances and consult with a professional before seeking resolution.
Although nothing in this article should be construed as legal advice, there are four guidelines you should follow when resolving employee dishonesty.
1. Measure Twice – Cut Once
Accusing an employee of stealing is a high liability action. You want to be sure of several things before you confront an employee for dishonesty.
Your first step is to ensure the loss was intentional. That is, you want to be sure it was not the result of a mistake, a systemic issue, or caused by an accounting error.
Remember that employees make mistakes counting back change, shipments can be short, and banks sometimes misplace deposits. It is often safer to react to a series or trend of losses than responding to a single occurrence.
2. Collect the Evidence
Feelings, baseless assumptions, and hearsay make terrible evidence. Once you’ve ruled out error, collect all evidence that supports an intentional loss occurred. Packaging, documents, employee schedules, reports, bank statements, and video evidence are all critical in the investigation.
These materials provide proof that a.) a reasonable person would conclude a theft occurred and b.) help define a suspect list of those potentially involved. Secure all the evidence as part of your case file.
3. Prove Innocence
In a full review of your evidence, try to prove innocence, not guilt. Consider all the ways that might demonstrate an employee wasn’t involved or engaged in dishonesty. It also helps identify all the excuses and rationalizations a dishonest employee might use to avoid responsibility.
Proving innocence is a powerful method to ensure that you’ve identified the correct suspect and have valid reasons to speak with them about the loss.
Employee theft is an emotional situation. Someone you trusted has stolen from you or the company. It is normal to desire a quick resolution. However, sometimes it is prudent to wait. Nothing is lost by securing additional proof. If the evidence is weak or the suspect list is too long, you may be better served by conducting other investigative methods. Consider installing video cameras, conducting an integrity shop, or increasing auditing of specific areas like cash drawer counts.
4. Conduct an Objective Interview
If the investigation can’t rule out an employee as a potential suspect, a conversation is warranted. This conversation is called a professional interview and should be handled by a certified professional.
It is unlikely that a dishonest employee will admit to theft when directly accused of stealing. Certified interviewers are trained in the proper methods required for a successful outcome. They use methods that don’t cross any legal boundaries or demonstrate disrespect to your employees.
The latter is essential since the interviews could include employees who had the opportunity but didn’t steal. You don’t want the outcome of your discussions to be one dishonest employee terminated and several honest but disgruntled employees who resign.
If your evidence is direct, such as video, and you decide to interview without a certified interviewer, keep the discussion directly related to the issue and the evidence.
These guidelines are the essential steps in resolving employee theft. As stated, while there is some legal leeway in accusatory employer-employee discussions, employers do not have carte blanche in their resolution methods. Most cases of employee dishonesty, when handled professionally, can be resolved without creating legal difficulties. Often, seeking professional assistance is the best course of action.
About the Author
Raymond Esposito is President of Loss Prevention & Compliance for HS Brands Global. He has over 30 years of loss prevention experience and has spent the past two decades building premier LP outsource programs for some of the world’s most well-known brands. He has worked with over 130 retailers within the department store, specialty, restaurant, grocery, and pharmacy industries in the US, Canada, and the United Kingdom.
His articles and interviews have appeared in various magazines, including Security Source Magazine, LP Magazine, Family Circle, and Small Business Radio.