How to Write an Effective Workplace Theft Policy for the Employees

According to the Association of Certified Fraud Examiners (AFCE)'s 2024 Report to the Nations, asset misappropriation schemes (such as employee theft) cost organizations a median loss of $120,000 per scheme and took an average of 12 months to detect. Don't let your organization fall victim and become one of the workplace theft statistics!

Wondering how to deal with theft in the workplace? Start with a policy. A clear, concise, well-written and up-to-date workplace theft policy can prevent violations at work by clarifying expectations and clearly explaining the company’s approach to theft. If your workplace theft policy needs a major update, or if you realized that you don’t even have one in place yet, then you’re in luck because we’ve put together a basic outline to help you get started.

Why You Need a Workplace Theft Policy for the Employees?

A workplace theft policy is essential to protect both the organization’s assets and its reputation. Without clear guidelines, businesses risk financial loss, reduced employee morale, legal complications, and damage to their brand.

Beyond physical theft of property, workplace theft can also include time theft, intellectual property theft, and misuse of company resources. A formal policy helps set expectations, defines unacceptable behaviors, and outlines consequences, ensuring that all employees understand their role in maintaining a trustworthy environment.

A well-communicated theft policy also reinforces a culture of accountability and fairness, where ethical behavior is the norm and misconduct is addressed consistently and transparently.

How to Write an Effective Workplace Theft Policy for the Employees

Creating an effective workplace theft policy requires more than just stating that theft is prohibited. It should be clear, comprehensive, and actionable. Key elements include:

• Define Theft Broadly: Clearly outline what constitutes theft, including physical goods, confidential information, company time, and misuse of resources.
• State Zero-Tolerance Commitment: Communicate that theft, in any form, will not be tolerated and that all incidents will be investigated thoroughly.
• Outline Reporting Procedures: Provide employees with clear instructions on how to report suspected theft confidentially and safely.
• Explain the Investigation Process: Detail how theft allegations will be handled, ensuring fairness and compliance with internal investigation standards.
• Describe Potential Consequences: List possible disciplinary actions, up to and including termination, and mention that legal action may also be pursued if necessary.
• Promote a Culture of Integrity: Emphasize the organization’s commitment to ethical behavior, respect for company property, and mutual trust among employees.

An effective policy not only deters theft but also reassures employees that the organization takes fairness, security, and ethical behavior seriously.

1. Define the Purpose and Scope of the Policy

Having a clear policy at work helps to create a common understanding of what the employer sees as “acceptable” or “unacceptable” behavior on a number of topics, including using and taking the company's assets.

Employees stealing from work? Download the free How to Confront Employee Theft cheat sheet to learn how to handle workplace theft cases.

For this reason, workplace theft policies should begin with a straightforward definition of theft, including examples employees could really see at your company. Also include a description of the scope of this policy, which means who it applies to (e.g., part-time, full-time, interns, contractors, etc.) and what behaviors it covers. It should be written in plain language and leave no questions about what behaviors will and will not be tolerated.

Example

Your policy can explicitly state that the company expects all employees to act honestly and with integrity, and will not tolerate any acts of theft or fraud in the workplace.

For extra clarity, list some examples of theft in the workplace:

• Theft of cash
• Theft of physical goods or assets (e.g., equipment, inventory, supplies)
• Intellectual property and/or trade secret theft
• Time theft (i.e., conducting personal or competitive business while "on the clock")
• Workplace theft of employees' property (i.e., stealing a coworker's personal items)

You should also describe those who may be victimized, such as the employer, coworkers, clients, and customers. In your policy, be as thorough as possible. It's better to include too much information than too little!

2. Explain the Consequences of Workplace Theft

The second key element of a workplace theft policy is raising awareness of the potential consequences if an employee violates the policy, including disciplinary action for theft in the workplace.

An employee will be likely to make better decisions if there is a policy explicitly stating the company takes these matters seriously and that there are consequences in place to deal with those that violate the policy. Otherwise, they might think they can just "get away with it," especially if they steal only once or twice.

A workplace theft policy should explain that all reported and suspected violations will be investigated no matter how small or seemingly insignificant. In addition to professional discipline, your policy may detail other consequences such as restitution (paying back what was stolen) or legal action.

To protect your organization, don't forget to also include details on employee rights when accused of theft, so they know you aren't going to fire them without a thorough investigation.

3. Outline Roles and Responsibilities

Every workplace theft policy should include a section that explains how the employer will work to address theft in the workplace and prevent it, too.

These responsibilities may include things like:

• Raising awareness of the policy to all new and existing employees (should include first-week reading as well as annual employee training)
• Establishing a confidential reporting procedure or “hotline” where employees can report suspected theft and fraud
• Enforcing all pieces of the policy including properly investigating claims of theft consistently regardless of an employee's tenure, department, or level
• Asking workplace theft investigation questions in subject and witness interviews that will uncover the truth while not leading witnesses
• Following through with appropriate discipline per the policy section described above

Companies should provide opportunities for employees to undergo training to better understand theft and identify it in the workplace. This training should describe what theft looks like, how to report it, and details from your policy. You can even outline common employee theft investigation questions in this training so they won't be surprised by the process.

4. Extra Tips for Writing a Workplace Theft Policy

For a really effective workplace theft policy, these extra tips might be just what you need. They can ensure you deter an employee stealing from company funds, protecting your assets.

Keep the Language Simple

Your theft policy must be written simply enough that your employees, AKA those who will read the policy, can fully understand each section. It should be easy to comprehend for employees in every department and level, free of buzzwords and lingo. Keep it concise, as no employee wants to read a long, dull document, nor will they remember its details.

However, the policy must be written in a formal tone to convey the importance of the document (but not too formal so that it reads like a textbook).  In short, strike a balance between simplicity and seriousness.

Cater to Your Industry

Depending on the industry, your policy may require more detail to address all of the “shades of grey.”

For example, would it be considered theft if a retail worker let a family or friend use their employee discount? This is a unique situation that a retail store would need to address in their policy but a payroll company, for example, wouldn’t.

Consider the potential fraud and theft scenarios that apply to your industry and company size and include those in both the policy and its accompanying employee training. More specific and "real-life" examples help employees understand the policy better, helping reduce incidents.

Need More Tips?

If you need more workplace theft prevention tips, check out seven must-haves for your policy that will help you deter company theft. It's easier to prevent theft than to deal with the aftermath, so take the time to implement these suggestions into your workplace policies and protocols!