Employee Theft Jumps By A Fifth As Cost Of Living Pressures Mount

• Theft at work in England and Wales leaps 19% as cost of living pressures increase
• New Freedom of Information data reveals Northamptonshire recorded the highest rate of employee thefts per 100,000 of the population while Lincolnshire saw the biggest percentage increase
• Insurer Zurich UK has seen a rise in claims for commercial crime, with companies facing average losses of £140,000
• Firms urged to ensure they have the right measures in place to protect against workplace crime

Employee theft has jumped by a fifth (19%) as the rising cost of living triggers a wave of workplace crime, new data suggests.

National figures reveal almost 6,000 workers were caught stealing from their employer in 2022, up from 5,000 the year before.  This amounts to nearly 500 incidents every month.

The analysis was carried out by insurer Zurich UK based on Freedom of Information data from 43 police forces in England and Wales.

London’s Metropolitan Police saw the highest number of employee thefts, with 874 incidents last year, while the City of London saw the fewest, at 18.  The biggest increase in thefts occurred in Lincolnshire, up from 40 to 71 incidents – a rise of 44%.

By police force, the highest rate of employee theft was recorded in Northamptonshire, with 43 incidents per 100,000 people, while the lowest was found in Dorset.

Employee theft ranges from petty pilfering of office supplies to the theft of data and embezzlement of company funds.

Although overall numbers are low, Zurich has seen an increase in commercial crime claims, including employee theft, which can leave firms facing average losses of £140,000.

Recent claims include a £150,000 theft by a ring of employees at a food manufacturer and a £50,000 claim from a double-glazing firm defrauded by its finance manager.

Rose Sutton, a senior Speciality Lines claims expert, said:“As cost of living pressures mount, employee theft has significantly increased, suggesting some workers could be turning to desperate measures to make ends meet.

“The consequences of employee theft can be devastating for companies, resulting in reduced profits, lower staff morale and in extreme cases, even bankruptcy.   Consumers also lose out through higher prices.

“No business is immune to theft in the workplace, which can go undetected for years, and occur at all levels.  Unless firms have the right protection in place, they have little chance of recovering stolen cash and goods, and may face other expenses, such as regulatory fines.

“Insurance provides a vital safety net that can help firms mitigate the impact of financial losses and resume normal operations quicker.”

Firms can reduce the risk of employee theft by implementing robust payment controls, regular audits, and a positive work culture.

Zurich has also seen an increase in claims for social engineering, where fraudsters manipulate employees into making payments or handing over bank details and passwords.

This includes cases where criminals have hacked a senior employee’s email and sent urgent payment instructions with fraudulent bank details to other staff members and external parties.

Arunava Banerjee, Cyber Risk Consulting Lead at Zurich Resilience Solutions, said: “Fraudsters are using ever more sophisticated techniques to trick employees into divulging sensitive information.

“These tactics can sometimes be difficult to detect, making it crucial that employers have robust security measures in place, alongside effective cyber awareness training to help staff detect and avoid these scams.”

Ends

Chris Johnson
Zurich UK, Senior Media Relations Manager
chris.1.johnson@uk.zurich.com / 07812 265 245

Notes to editors

For 2022 employee thefts, Zurich sent Freedom of Information requests to 43 police forces in England and Wales.  The data covers January to December.  For 2021, data was collated from the Home Office, Police recorded crime Police Force Area Open Data tables.

Rates per capita calculated using population figures for police regions in England and Wales.  These were adjusted by the percentage of the population of England and Wales aged 16 to 64 (62%) and the headline employment rate of those aged 16 to 64 (76%).  The City of London was excluded due to the low population.

Employee thefts by police force in England and Wales

*Data for Merseyside, Sussex, West Mercia and West Yorkshire collected for January to September 2021 and January to September 2022.

Five types of theft from work

1. Cash: Employees stealing money from tills or petty cash.
2. Inventory: Employees making off with merchandise or office supplies.
3. Data: Stealing sensitive information such as customer data.
4. Intellectual property: Theft or misuse of trade secrets or other intellectual property.
5. Embezzlement: Employees misusing company funds or resources for personal gain.

Eight strategies to protect your business from employee theft

1. Carry out employee background checks
2. Ensure you have robust approval and verification processes for payments
3. Document all transactions using purchase order, invoices and receipts
4. Put in place a random audit schedule and use different internal auditors
5. Ensure employees feel valued
6. Ensure employees can speak up through confidential whistleblowing channels
7. Give employees flexibility to avoid theft of time
8. Invest in strong cyber controls and security awareness