Could an employee be cheating on you? Six ways to protect your business from staff misconduct

As your business grows and you bring on more staff you can begin to experience a wide range of employment issues including misconduct and serious misconduct.

When you think of misconduct the obvious examples of fraud, theft, assault, being drunk at work and refusing to carry out work duties can come to mind. Though it is more widely considered misconduct when an employee:

  • Causes serious and imminent risk to the health and safety of another person or the reputation or profits of their employer’s business or
  • Deliberately behaves in a way that is inconsistent with continuing their employment

With misconduct often having devastating effects on your business, reputation and bottom line, it is vital that you take every possible step to safeguard your business. To help you, here are six ways to protect your business from staff misconduct.

1. Know your employees

Before hiring any employee make sure adequate due diligence is done. While reference checking is a great start, for executive management positions and those roles that require money management and greater access to your intellectual property, client and financial records, a background check is recommended.

2. Ensure adequate supervision

While we don’t recommend looking over an employee’s shoulder every minute, close supervision can help to discourage theft, fraud and crimes of opportunity. For this reason, it is also sensible to have more than one person responsible for critical management duties like money management and security.

3. Watch for changes in behaviour or personal circumstances

From experience, there are often signs or red flags that employees exhibit when considering or doing the wrong thing. A sudden change in their attitude towards work, for example, like coming in late, taking longer breaks, having more sick days, erratic behaviour, moonlighting with company property, missed deadlines and frequent disappearances.

The opposite can also be a red flag, like a sudden commitment to working harder and later, a keen interest in operational procedures, or strong opinions and objections to procedural changes particularly in the areas of security, finance and product inventory and supply.

Lastly, personal issues like financial difficulties and living well above means, or destructive behaviours like compulsive gambling, or drug and alcohol abuse can also play a role. While these issues will not necessarily lead to employee misconduct, they can make an employee more motivated and should be closely monitored.

It is important that you deal with any personal issues in a way which lessens your liability. For example, a staff member who has disclosed they have a mental illness will require a certain course of action. On the other hand, a person going through a divorce or a break up will also need different steps to be taken (being separate) to the issues giving rise to misconduct.

4. Install computer security measures

With a growing need to work on the road and a rise in flexible work arrangements, employers are being forced to give employees greater access to confidential information to improve business efficiency and productivity. While this can be beneficial to your business, it also increases the risk and opportunity for misconduct with confidential information being able to be accessed remotely.

For this reason, it is important to speak to your IT specialist to ensure you have adequate computer security measures in place. These may include upgrading or replacing legacy devices, implementing secure firewalls at the network perimeter, locking down remote access to users without a secure connection and enforcing two factor authentication for services. It may also be a good time to review backup procedures and perform disaster recovery testing.

Our friends at JMR IT discuss this in a bit more detail.

5. Establish clear policies

Policies are crucial to a successful employer and employee relationship and can protect your business in a number of ways. They are also the only documents you have the power to update and change unilaterally.

A clear misconduct policy and a comprehensive code of conduct will ensure that your employees know what is expected of them and have a clear understanding on the consequences they will face if policies are breached.

6. Be specific in your employment contracts

The employment contract is one of the most understated documents in any business, and yet it can be one of the most important when it comes to the employment relationship. In your employment contracts, you can include clauses that protect your intellectual property, address restraint of trade and the poaching of staff and clients, safeguard against underperformance and misconduct and most importantly address termination of employment.

When an employment contract is ongoing, it is crucial to have termination clauses that outline circumstances when employment can be terminated and how the termination will be carried out. Even though these clauses exist in your contract for your protection, it is recommended to speak to an employment law specialist before it is enforced, as there is a specific process that should be followed when terminating for misconduct which greatly reduces your risk and liability.

Concerned about misconduct in your workplace? Want to ensure your business is protected? Call NB Lawyers, the lawyers for employers, today on +61 (07) 3876 5111 to organise a consultation or email [email protected].

Written By
Jonathan Mamaril
NB Lawyers – Lawyers for Employers
[email protected]
+61 (07) 3876 5111

About the Author
Jonathan Mamaril is the principal and director of NB Lawyers, the lawyers for employers, and a specialist in employment law. Over the last ten years, Jonathan has helped hundreds of employers understand their legal requirements, mitigate risk and liability, protect their reputation and achieve their goals for business growth and expansion.