Owning a business is hard work and dealing with dishonest employees can sometimes be a part of the job. The National Retail Federation reports employee theft costs U.S. companies as much as $200 billion every year.
Employee theft can be disastrous for a business and its bottom line. To help protect your business against employee theft, be aware of five common stealing practices and learn how you can prevent the act from happening.
1. Stealing From the Cash Register
Employees working a cash register or regularly taking payments from customers can easily steal money from the company. It’s easy to accept a cash payment and immediately void the transaction so it appears the transaction never took place. The employee pockets the cash and their drawer balances, without any questions being asked.To help remedy stealing cash from the register, you can install video cameras to watch the registers. Many security providers offer camera surveillance with their security systems. Many are even Internet Protocol (IP) cameras that can stream live over the Internet, so no matter where you are, you can keep an eye on the cash register.
2. Faking a Time Card Punch
Time theft can be just as devastating as stealing cash. A long-time technique known as “buddy punching” allows one employee to punch in or out for another employee. Some employees also fill out their time cards for days they weren’t at work or for a lunch hour they spent away from the office.A new way to keep track of employees’ time is with biometric time keeping. With this feature, fingerprints are required to clock in and out. This eliminates employees clocking in for each other.
3. Stealing Data
Your company data, such as customer records, digital assets, or proprietary information, is just as valuable as cash flow. When an employee leaves the company or becomes disgruntled, stealing data is possible.Track access to computer programs, like who logs in or out of a computer and what files they access. It’s also a good idea to force employees to change passwords on a regular basis and to discontinue accounts for any former employees. As soon as an employee leaves the company, immediately disable all accounts associated with that employee.
4. Taking Office Supplies
If an employee never takes vacation or frequently stays late, this could be a sign of theft. After hours, when nobody is watching, it’s easy to swipe office supplies, inventory, or petty cash. All it takes is a truck pulled around the back to haul away the goods.Remedy this situation by installing and using a security system that detects when doors are opened/closed. Get a system with security cameras and place them at all entrances and places like supply closets or warehouses. You’ll also want to monitor who stays late, how often, and why they need to be there after hours.
5. Accepting Vendor Supplies
If an employee has buying privileges or wants to do business with only one vendor, he may be taking kickbacks from the vendor in exchange for business. Accepting cash, gift cards, or special gifts in exchange for business is a form of stealing. In some cases, the vendor often charges a little more and shares the extra amount with the employee offering the privileges.
Make sure you are tracking all purchase orders, either by numerical order or by date. You’ll also want to separate responsibilities for those in charge of purchasing. For example, one employee can set up vendor accounts while another verifies the invoices and makes payments. The more people who know your company accounting system, the less chance there is of giving business to one vendor.
Employee theft can be harmful to any business, but there are ways to help prevent it. Do your part to protect your business from theft.