Establish the facts

Even if you strongly suspect a particular member of staff, you must not jump to conclusions about their guilt.Instead, you need to appoint someone to investigate who has a good knowledge of your organisation and how it operates.

You must also carry out a reasonable investigation.What is reasonable will depend upon the nature of the allegations and, generally, the more serious these are, the more you will be expected to do.At one extreme, there will be cases where the employee is virtually caught in the act and others where there is only circumstantial evidence of the employee’s guilt.As the scale moves towards the latter end, the amount of enquiry and investigation is likely to increase.You don’t have to leave “no stone unturned” – just act reasonably.

For example, a tribunal found that an employer should have watched five hours of CCTV footage to find out whether the employee’s version of events were accurate in circumstances where she was accused and then dismissed for theft.However, it was unnecessary for a different employer investigating an employee’s exaggerated expenses claims over a three month period to examine and seek an explanation for every journey.It was reasonable for the employer to focus on a handful of expense claims.

The investigation must be fair and even handed.This means that the investigator should look for evidence that points to the employee’s guilt as well as that which points to his innocence.

Do you need to suspend the person/people you suspect of stealing?

That will depend on the nature of the theft and how much “proof” you have that the individual is likely to be involved (as opposed to another member of staff).

As a rule of thumb, you should only suspend an employee if it is necessary to do so.This will usually only arise where you suspect the employee of serious misconduct and you believe that the employee may tamper with evidence, put pressure on witnesses or even continue to steal from you.Even in these circumstances, it may be possible to ask the employee to undertake reduced or alternative duties (and impose other restrictions to prevent them from stealing) rather than completely suspend them from work.

Suspending someone is a serious step and you must have a good legal reason for taking it.It should not be an automatic “knee jerk” reaction to allegations of misconduct.You must be particularly careful before suspending senior employees without good evidence because the repercussions of them being excluded can be serious.It is common for suspended employees to feel belittled and demoralised and it can be difficult for them to regain their authority when they return to work or avoid a slur on their reputation even where they are subsequently cleared of the charges.

If you suspend someone without a good legal reason, it is likely to damage the relationship of trust and confidence and may entitle to the employee to resign and claim constructive unfair dismissal (provided they have at least two year’s continuous service).

Do we have to pay an employee if s/he is suspended?

Yes, unless you have a contractual right to suspend without pay (which would be unusual).During suspension an employee should also continue to receive their normal contractual benefits, such as health and life insurance, company car etc.

Our investigator has interviewed two witnesses who wish to remain anonymous.  What shall we do?

The employee is entitled to know the case against him/her.This generally means that they should be sent copies of any evidence obtained (including witness statements) before any disciplinary hearing takes place.

The investigator should find out why the witnesses wish to remain anonymous and, if possible, try and resolve any concerns they have.The ACAS guide on investigations recommends that investigators should, wherever possible, avoid anonymising witness statements as this can disadvantage the employee and mean that s/he cannot effectively challenge the evidence.

Generally, unless the witness has a genuine fear of reprisals, the investigator should not agree to anonymise their statement.

Should the investigator give an opinion on the appropriate sanction?

No.The role of the investigator is to consider the allegations against the employee and to determine whether, on the evidence, they are likely to be proven or and should not suggest dismissal or prejudge what the outcome to a grievance or disciplinary hearing will be.

Conduct a disciplinary hearing and appeal

If you decide (after the investigation) that there are grounds to suspect the employee of theft, you should invite the employee to attend a disciplinary hearing. You must set out the allegations in writing and provide sufficient information about the evidence you have to enable the employee to prepare.  This would include any written statements you have obtained or CCTV imaging.  You must also warn him/her that they may be dismissed and that a colleague (or trade union member) can accompany them.    

The purpose of the meeting is to establish the facts, not to catch people out.  You should give the employee the chance to give you their side of the story and consider this before reaching a decision.  You must confirm the decision in writing and offer the employee the right to appeal.

Remember: the people conducting the hearing and appeal must not have been involved in any other stages of the process (including the investigation).

What standard of proof we should adopt?

The decisions you reach must be based on a balance of probabilities.  This means that you must be at least 51% sure that the employee is guilty of the offence s/he is accused of.  Another way of looking at it is that you must think it more probable than not that the employee is guilty of that offence.  If you cannot satisfy this, then you should not dismiss the employee (or impose a lesser sanction).

The higher burden of proof in criminal cases (beyond reasonable doubt) does not apply to civil cases.

Can we dismiss for theft even if the employee otherwise has an unblemished record?

Yes. Normally, employers are expected to issue at least one warning before dismissing a member of staff for a first offence.However, theft is generally treated as gross misconduct, which is the most serious type of misconduct.

However, that does not mean that you have to dismiss the employee.The employee may admit their guilt and have genuine (albeit misguided reasons) why they have done so and in such circumstances you may decide to issue a final written warning instead.But, theft normally destroys the relationship of trust between the parties and dismissal is often an appropriate response.

Do we have to pay the employee notice pay?

No. If you dismiss the employee for gross misconduct, their dismissal is effective from the date you communicate your decision to them (or when it is received in the absence of a contractual provision that states it is when sent) and you do not have to give them notice or make a payment in lieu of notice. 

10 Can we deduct the amount the employee has stolen from their final pay?

Not unless you have a contractual right to do so which is set out in the employee’s contract or statement.This is because employees are protected from having deductions taken from their pay and can bring a claim against you to recover any amount due (even if you have proof they have stolen money)!

You may be able to recover the money by making a claim in the civil courts.

You could also involve the police.

11 Improve your workplace security

You could consider introducing tighter security measures to prevent further instances of theft.  Be aware though that installing covert surveillance cameras is likely to breach data protection laws.  If you are considering installing cameras, take legal advice first.