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Employee Theft News

Written By ESR News Blog Editor Thomas Ahearn

Employee theft in the United States accounted for 43 percent of lost revenue – about $18 billion – while dishonest employees around the world accounted for only approximately 28 percent of inventory losses globally, according to the Global Retail Theft Barometer 2014TM.

The study is the first and only global research on the cost of “shrink” – comprised of shoplifting, employee theft, supplier fraud, and administrative errors – and provides data to help retailers around the world benchmark performances for merchandise, markets, and geographies.

Overall, the study found that annual shrinkage cost U.S. retailers around $42 billion a year. Shoppers in the U.S. also paid the price for loss of merchandise, around $403 annually per household. The study is available at

An article on reported that the study found discounters experienced “higher rates of employee theft than home improvement stores or supermarkets.” Also, most employee theft was also done “in subtler ways” than simply walking off with merchandise or cash.

One of the authors of the Global Retail Theft Barometer 2014TM – loss prevention specialist Ernie Deyle – told Forbes that employee theft usually “happens during checkout, when an associate manipulates a transaction to benefit themselves or someone else.”

Deyle told Forbes that employee theft may come from employees entering refunds, discounts, or voided transactions into a cash register. Employee theft can also occur when employees “cancel transactions, modify prices, or say someone used a coupon when they didn’t.”

Along with how employee theft is committed, Forbes also reported that the study found reasons why employee theft is a problem worldwide: “Key reasons … include ineffective pre-employment screening, less employee supervision, and easy sale of stolen merchandise.”

Cultural differences also led to employee theft. “Internationally, there’s more of an unwritten code that says it’s not honorable to do something dishonest toward an employer,” Deyle said. “Here, it’s a different mindset. There’s so much turnover in retailing, and very little loyalty.”

Employee Theft News from ESR

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