Staff theft continues to be a worry for retailers, but there are ways to protect yourself from pilfering employees

Trust is a tricky issue. If your business has reached the level that you need to employ large numbers of staff, you need to be sure they’re the right people for the job. After all, they’re the ones helping to keep the business running smoothly those you work alongside on a regular basis and who represent you when you’re not around. They become a big part of your life, which makes it even more devasting if they steal from you.

Unfortunately, staff theft is not an issue that’s going away. According to the latest Association of Convenience Stores (ACS) figures, the cost of staff theft has increased by 143%, with the average cost per instance rising 90%, meaning that not only is it increasing, but the thieves are getting bolder. And with more than 300,000 people working in the c-sector, there’s bound to be a few that think it’s okay to steal from their employer and that it has no impact on the business.

It’s vital that retailers hammer home the fact that any money stolen from the store, aside from being illegal, impacts on the bottom line, jeopardising the business and their job.

Cambridgeshire retailer Jonathan James was betrayed by a member of staff who was able to exploit the store’s epos system to steal a huge amount of money. “We had a member of staff who stole about £8,000 from us over a period of 18 months,” he says. “It started out as £5 here or there, but escalated to huge levels.

“Advances in epos technology mean that tills are more like computers and can be easily exploited,” adds Jonathan. “What he was doing was quite simple - he would scan the items then put the transaction on hold and would see how they were paying. If they were paying by card he would run it through normally, but if they were paying by cash he would void the transaction and keep the money. He even realised that the till would beep when a transaction was put on hold, so he would lower the volume as soon as he started his shift.”

What to do

If you know for certain that a member of staff is stealing from you, there are options:

● Name and shame - Make sure all other staff members know that the individual has been caught and that stealing will not be tolerated

● Report it to the police -Even if the amount stolen is small, as the police can only act if they are informed about it. Plus, it will make it clear to anyone else who may be tempted that you have a zero tolerance policy

● Civil recovery - If a large amount has been stolen, you may be able to demand civil recovery where they repay the money or the same value of goods stolen.

Jonathan and his management team had their suspicions about the employeee, but found it difficult to prove. “We knew something was up, but couldn’t prove it, and it was only when a member of staff asked for a receipt that he was caught out,” he says. “You have to be careful with epos. Check through the records as often as possible and look for cancelled transactions - if there are lots by the same person, or at the same time every week, then investigate further.”

Once confronted, the employee confessed and Jonathan made sure that other team members knew theft would not be tolerated. “We made an example out of him and reported him to the police,” he says. “However, the sentence wasn’t as harsh as I would have liked considering the amount he stole.”

Jonathan had to make sure that the thief was acting alone. “We asked him if anyone else on the team was involved in the scam,” says Jonathan. “It was quite distressing to think that other members of staff might also be stealing from us, but he was adamant that it was just him and the police were satisfied that this was the case.

“Staff theft affects the whole team - you lose trust in your staff and you have to make it clear to everyone that it will not be tolerated.”

It’s not just cash that retailers should be worried about. It’s vital that you monitor stock to ensure that staff members aren’t taking a five-finger discount and filling their bags after a shift.

Susie Hawkins of Simon Smith Group in Gloucester cuts down on any potential stock theft by enforcing strict rules. “They are in effect a customer and must pay for their purchases immediately - there’s no paying for it later,” she says. “It may seem strict, but it’s to ensure that there are no grey areas, plus sometimes people just forget that they owe money and it can be difficult to broach the situation. We also require staff to keep receipts for their store transactions for three months. It’s rare that we would need to go back that far, but it’s another way for everyone to cover themselves and know exactly where they stand.”

Spot the signs

● Behavioural patterns - Have staff exhibited noticeable personality changes recently?

● Flashing the cash - Are members of staff displaying unexplained wealth, or living beyond their apparent means?

● Time out - Is a staff member having an excessive number of toilet or cigarette breaks?

● Outside interference - Are your staff in frequent communication with external parties while at work or on breaks?

● Money back - Have there been large volumes of refunds to customers?

● Voided transactions - A high number of voided transactions should raise alarm bells.

The group has 100 staff members spread over seven stores, so it’s important to take a hard line on internal theft.

“It will always be an issue for retailers, but it’s important that you manage and control the situation,” explains Susie. “We have very clear procedures in place and the staff are informed of these once they start. They also know that we have a zero tolerance approach to theft and that we will involve the police.”

Her team checks through the till records regularly and watches out for voided high-value items such as tobacco and alcohol. She also advises retailers to be vigilant for items with round price points. “We check till records every week so we can catch something early,” says Susie. “But if there are a lot of items voided that cost £1 or £2, we pay close attention as they make it easier for any potential thieves to calculate how much should be in the till.”

Susie ensures she vets all staff before they begin working for her. “We ask all potential employees to provide a police reference for us before they start. It costs £10 to do, but we refund them the money. They’re not legally obliged to do it, but we find that most are happy to do so, and those that aren’t rule themselves out of the job.”

Susie isn’t the only retailer to do this. John Cuthbertson of Premier at Dundee University requests a police recommendation from all new staff members. “As we’re on a university campus we get a lot of applications,” he says. “We have a very strict vetting process which helps ensure you will get staff who will be more loyal to you.”

John has 25 staff, including 13 part-time students, and says they all understand the consequences of stealing. “As well as losing their job, they know it would be a police matter, plus they may be expelled from university. They know they have a lot to lose.”

The store’s management team also has clear procedures in place to prevent crime. “Our staff know that they can’t take bags behind the till. We also conduct occasional bag checks if necessary. And we check tills at the end of every day so we’ll know if there’s a shortage straight away. It’s all about being proactive and making staff aware of the processes involved.”

While staff theft is unlikely to be wiped out overnight, if retailers make it clear to staff that it won’t be tolerated and do all they can to prevent it, at least you can reduce the risks.•