Over 4,500 staff stole from their workplace last year

While M&S recently battled cyber attacks that cost them nearly $400m, not all threats come from external attacks. Sometimes the danger is much closer to home. 

New data shows that over 4,500 workers in the UK were caught stealing from their employers last year. And it’s not just small change, the average loss per theft is a staggering £35,728, with incidents ranging from cash theft to embezzlement and fraud.

Hospitality and ecommerce are two of the most at-risk sectors for employee theft, due to staff having access to sensitive data, handling cash, and managing stock. 

London worst city for employee theft

Analysis carried out by insurer Zurich UK, based on Freedom of Information data, has today revealed that 4,562 employees were caught stealing from their workplace over the last year. 

The impact of employee theft can be incredibly costly. Each incident can cost a business up to £35,728, which could be especially devastating for SMEs with smaller cash reserves. 

According to Zurich’s data, the biggest case of employee theft involved a high-end jeweller that lost £249,229. In other incidents, a medical centre was defrauded of £50,000, while a furniture company lost £63,439 to embezzlement.

Unsurprisingly, employee theft is most rife in the capital, where there are also the most hospitality businesses. London’s Met Police recorded 794 incidents last year. 

On a more positive note, Gloucestershire police saw a 46% decrease, with 50 cases of employee theft in the last year, compared with 93 in the year before. 

Robert Higgs, a Senior Speciality Lines claims expert for Zurich, commented: “Employee theft takes on many forms, from petty theft of stationery to fraud and embezzlement, which can cost hundreds of thousands of pounds and be devastating to businesses.”

Which industries are most at risk?

Hospitality and ecommerce businesses are some of the most vulnerable to employee theft. In hospitality, staff often handle cash directly, and the prevalence of zero-hour contracts and high staff turnover can make it difficult to build strong employer-employee relationships. 

In ecommerce, the risks are slightly different but equally significant. Employees working in shipping and fulfilment may have easy access to stock, increasing the chance of inventory theft. There’s also more exposure to sensitive customer data, putting firms at risk of fraud.

While Zurich’s data shows a 15% drop in reported cases since our last update, the threat clearly hasn’t disappeared. 

How to protect your small business from employee theft

Being aware of the range of types of employee theft is the first step in protecting your business against avoidable losses. According to Zurich, it can take many forms:

• Cash theft from tills, safes, or petty cash
• Inventory shrinkage, through stolen stock or false returns
• Data theft, such as misusing customer or payment information
• Intellectual property (IP) theft, where staff take knowledge, designs, or client lists 
• Embezzlement, when staff use company money or resources for personal gain

As the cost of living crisis continues to put financial pressure on UK households, the persistence of employee theft, alongside a surge in shoplifting, is creating a challenging environment for high street businesses and retailers. 

For small businesses, especially in hospitality and ecommerce, security is paramount. The good news is that there are practical steps you can take to defend your business from theft. 

Tools like POS systems with built-in fraud detection, real-time monitoring, and inventory management software can help you flag issues before they escalate. 

Cybersecurity tools are also a must-have to keep both your customer and company data safe, especially for ecommerce brands. And don’t overlook regular audits; even small, spot checks remind staff that you’re paying attention.