Who Is Stealing From You?

  • By Mark Ridgeway
  • 19 Jun, 2017

Hint: It's not who you think...

employee stealing cash
Employee theft is perceived by many, to be the biggest threat to retailers and small businesses.

With $50 billion in cash and inventory stolen yearly by employees, is it any surprise that 33% of all business bankruptcies are attributed to employee theft?

Globally, employees are responsible for around 28% of inventory losses, while shoplifters account for 39%. In the U.S. however, employee theft accounts for 43% of lost revenue. That’s about $6 billion more than five-finger discounts taken by shoplifters.

According to The Global Retail Theft Barometer , 75% of American employees have stolen at least one item from their employer. There’s a different mindset in the worker base here in the U.S. With such high turnover rates, especially among retailers, there is very little loyalty.

Sadly, about 75% of the crimes go unnoticed. And when they are detected many go unreported.

Nearly all businesses have experienced employee theft, but only 16 percent of them actually report the incident to police.

The three primary reasons they go unreported:
  1. The employer’s attorney advises against it. The legal costs and time involved often outweigh the amount the employee would pay back. Basically, the employer would never recoup the stolen funds.
  2. Many employees caught stealing have emotional or family ties to the employer and both parties want to put the issue to rest as quickly as possible.
  3. Business owners assume that police are too busy with other serious street crimes.

How is this happening? 

Loss prevention consulting firm Jack L. Hayes International  says that ineffective pre-employment screening and less employee supervision are the main catalysts.

  • Background checks are the first line of defense in keeping dishonest employees out of your business. In an effort to cut costs, some employers have lowered their standards in pre-screening requirements and are hiring less than ideal applicants.
  • Management levels have pulled back and more employees are going under-supervised, creating more opportunities for theft.

When a new employee is hired who hasn't been properly vetted, employers are basically welcoming a stranger into their business.

That stranger has access to your customers, your cash, your inventory, your IT — everything.

Relatively speaking, background checks are an inexpensive investment when you consider the painful cost of keeping a dishonest employee on your payroll for years…

Have questions about Pre-Employment Screening? Let us help! Call us today at 479-595-0419.


The CHC Blog

By Mark Ridgeway 19 Jul, 2017
As a business owner or HR professional you've been there: you’re at the tail end of a particularly difficult hiring process and you’ve finally found the right candidate for the job. It’s easy to say, “Phew! Glad that’s over,” and move forward with finalizing the details.

But before you do, you should really consider ordering a background check on your candidate of choice. Integrating a background check policy can really benefit and protect your company. Here are 5 reasons you should always run a background check:

1. Stronger hires = Saving Money

Don’t just rely on your “gut feeling.” The more you know about the candidate, the better you will be able to assess if he/she is a fit for the position and for your company. Talent acquisition is a struggle in nearly every industry, so make sure that you’re not cheating yourself out of any of the available information before extending an offer.

It’s important to point out that better hires often means less turnover. We know that turnover is typically the number one cost to employers. Save yourself from investing in the wrong employee for the job.

Aside from turnover costs, as was stated in a previous blog post Who Is Stealing From You , we know that upwards of $50 billion annually in cash and inventory is stolen by employees. Does your job candidate have a history of taking extra "perks" from previous employers?

2. Safer Work Evironment
Running a background check on potential employees before officially hiring them can aide in reducing workplace violence. As an employer, you’ve made a commitment to your current employees to operate a safe work environment. Don’t skip this important step in ensuring that safety.

According to the Bureau of Labor Statistics Census of Fatal Occupational Injuries (CFOI), of the 4,679 fatal workplace injuries that occurred in the United States in 2014, 403 were workplace homicides. However it manifests itself, workplace violence is a major concern for employers and employees nationwide.

3.  Better Compliance in State & Federal Regulatory Requirements
A third-party background screening provider with in-house compliance expertise, can help your company properly create a screening solution. This not only satisfies your industry standards, but also state and federal regulatory requirements, which vary from state-to-state and by type of position you are staffing. Utilizing a partner that is a true expert in this field is important for the success of your company.

4.  Decrease the risk of being sued
Making a bad hiring decision can leave you and your company vulnerable to liability. Ordering a background check can help you find patterns in a person’s history. For example, if a potential employee has had multiple discrimination suits against them, you as an employer may be liable should the employee discriminate within your workplace. Being able to sort out candidates with these issues will help decrease the chances of a lawsuit.

5. Verifying Resumes
Does your candidate have the experience they claim? Do they really have the education and the professional licenses that are listed on their resume? A survey from CareerBuilder  of more than 2,500 hiring managers found that 56% have caught job candidates lying on their resumes.

Background checks can help you weed out the people that do not have the skills for the job. It also can help you verify that the candidate’s resume is valid.  Don’t leave yourself vulnerable to these discrepancies.

Requesting a background check for a prospective employee is perfectly within your rights as an employer. These background check reports can hold vital information that is relevant to your hiring decision. You wouldn’t choose to not gather all of the relevant information when making a different business decision, so don’t skimp here either. Take the time to do your homework and you’ll see the results!

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