EMPLOYEE THEFT: BEHAVIORAL ASPECTS

The term employee theft refers to the unauthorized taking, transfer, or use of property of a work organization by an employee during the course of work activity. Straightforward as it seems, the application of the definition to employees' activity is complicated by two essential problems. The first centers on the issue of what is meant by unauthorized taking. If the activity is prohibited by company policy (formal norms) but sanctioned by the work-group and work-culture (informal norms), is it unauthorized taking? Technically and legally it is; operationally it may or may not be dependent on other elements of the work-group norms that prescribe and proscribe the behavior. The second problem in applying the definition to practice centers on the question of what constitutes company property. Not only are there several types of property in an organization—company, personal, and property of uncertain ownership (e.g., items in a wastebasket, unsolicited samples from vendors)—there are also forms of company property that do not ordinarily enter into the traditional calculus of employee theft. The latter might include the use of facilities and equipment for personal use—personal phone calls, typing personal correspondence on company computers, the use of sick leave for personal days off, or the theft of work time through simply "goofing off." In defining employee theft one needs to consider carefully what is meant by unauthorized taking and what property is included in the activity defined as theft (Greenberg; Hollinger and Clark; Horning).

Ancient or modern problem

Many regard and treat theft by employees as a relatively new phenomenon that emerged with the development of large bureaucratic organizations with their impersonal relationships between employers and employees. Employee theft is neither a new problem nor one limited to modern work systems. Reference to employee theft is found in one of the earliest bodies of laws, the Code of Hammurabi, carved on diorite columns during the eighteenth century B.C.E. The code's 288 laws contain at least eight specific references to employer-employee, consigner-consignee relations that apply to what is today called employee theft. For example, the 265th law states, "If a shepherd to whom oxen or sheep have been given to pasture become unfaithful, alter the brand or sell them, they shall convict him and he shall restore tenfold to their owner the oxen and sheep he has stolen" (Luckenbill).

What makes the problem of employee theft appear modern or of recent origin are the significant social changes that modern work systems represent: new organizational structures, new relationships between employers and employees, new configurations of material and products, new victims (including new legal constructs such as corporations), new opportunity structures that give workers access to more goods, facilities and services, new configurations of work norms regulating employee behavior, new systems for preventing or coping with employee theft, and the separation of property ownership from property control in the modern organization. Viewed together, these make the problem appear a modern one or at least one of a different order than earlier employee theft.

Terms used to describe employee theft

A sociolinguistic analysis of the terms used by the employee-perpetrator and the employervictim to describe acts of employee theft reveal significant differences in the way the act of theft is perceived. All but the high incident/high value perpetrators refer to their acts of taking property in more neutral terms, placing the act within acceptable work-group normative boundaries, by using euphemisms such as taking, salvaging, evening-up, compensating, borrowing, dipping, scrounging, taking out a loan, doing government work (especially for use of equipment and facilities), boss work (following the boss's example), and taking stuff for homework. Employee-perpetrators go to great lengths to avoid the term theft and having to define their behavior as theft. Describing those same acts, the employer-victims use more judgment-laden legal terms such as pilfering, theft, fraud, stealing, embezzling, and poaching. Although both are referring to the same act, each is revealing a different perception of it. Hence, what is a clear case of employee theft to the employer may be perceived by the perpetrating employee as a compensatory act that makes up for some perceived injustice or as a form of salvaging materials that would otherwise be tossed out. Often employees feel that the appropriation of materials from the work place is a job right, a fringe benefit of the job. Although the employer and employee may both agree that the theft of company property is wrong, they often fail to recognize that they may be referring to different classes of acts, categories of materiel, concepts of property, or views of ownership. It is not uncommon for employees to consider employee theft reprehensible while regarding their own taking of property as legitimate. An important element in this process is the division of property in the work system into that which is pilferable (comprising some forms of company property and property of uncertain ownership) and that which is not (some forms of company property and personal property). High incident/high value thieves cannot claim exemption from the designation thief; their acts are not legitimated in the work-group norms (Altheide et al; Greenberg; Hollinger and Clark; Horning; Terris).

Characteristics of the employee thief

Empirical research on employee theft reveals that it is the rare employee who does not pilfer something during the course of a work career. What differs for all but that rare employee, however, is the frequency of theft and the value of the goods taken: some steal often, others almost never steal; some steal goods having considerable value, others confine their behavior to items that have little or no value. Although any given episode of employee theft may involve seemingly insignificant amounts, the cumulative effect over time may be considerable.

Numerous attempts have been made to describe the typical employee thief. Many experts in security management have developed profiles that describe the prototypical employee thief: male, either young or older (competing data support either conclusion), has a financial problem stemming from gambling, drinking, drugs, or other equally costly excesses such as an expensive hobby or poor financial management (e.g., credit card problems). Although these descriptions may apply to those workers who are high incident/high value thieves, they are not particularly useful when one considers that only a few workers (normally less than 5 percent) steal with the intent to convert the goods to money. Most workers take only for personal use (Altheide et al; Greenberg; Hollinger and Clark; Horning; Terris).

Nonwork-related correlates. Many of the standard demographic variables—such as age, sex, race, education, religious affiliation, religiosity, residential mobility, number of dependents, size of community, marital status, marital stability, and home ownership—which play an important role in differentiating behavior in other forms of crime do not appear to have much predictive value in the case of employee theft. The evidence is often contradictory. However, some nonwork-related correlates, such as erratic personal and job history, poor credit ratings resulting from fiscal mismanagement, difficulty in getting along with others, a history of dismissal for employee theft and alcohol and drug abuse, do appear to be strongly associated with a high risk of employee theft. When all of the evidence is considered, one must conclude that in general most nonwork-related factors, taken separately, are not particularly useful in predicting either the incidence of an employee theft or the amount that the employee will steal (Altheide et al.; Baker and Westin; Greenberg; Hollinger and Clark; Horning; Terris).

Work-related correlates. Many factors in the work setting may have a bearing on the frequency and cost of employee theft.

Type of work system. Although all work systems have elements in common, each provides a unique configuration of opportunity and pilferability to its employees. Offices, mines, mills, factories, farms, hospitals, warehouses, retail stores, food processing plants, road construction businesses, and foundries have many elements in common, but more notable are the differences that shape the opportunity for pilfering from each. Some are generally low access/low opportunity systems with few pilferable items (e.g., mines or well-drilling operations), others are high access/high opportunity systems with necessarily minimal goods control (e.g., hospitals that have a high disposability factor for supplies). Compounding this is the great variability that exists within similar work systems (e.g., medical offices) that differ in scale, organizational structure, managerial philosophy, levels of technology, and levels of control and security. Add to these the specific elements of each organization's work subculture, which defines and sets parameters within which employee theft occurs, and one can see why measurement, prediction, and generalization are difficult.

Thus, to fully understand employee theft it is necessary first to acknowledge the importance of variations in work systems, and second, to recognize the role that individual work subcultures play in defining what constitutes theft in a specific organization.

Job classification and job skills. A national survey of internal company theft reported in 1982 that whereas executive level employees committed only 15 percent of the theft they were responsible for 85 percent of the total dollar loss. So, while it is true that most thefts are committed by workers such as clerks, delivery personnel, warehouse and sales personnel, and office and assembly workers, their activities account for only a small portion of the total amount pilfered. Normally, control efforts are directed at these more numerous but aggregately less costly thieves. Those in executive positions are generally considered to occupy positions of trust and less needful of security controls, but they are also the ones whose pilfering leads to substantially greater aggregate loss.

Length of service with the employer. Conventional wisdom argues that length of service can be both a positive and negative factor in employee theft. Research supports both perspectives. Length of service can be a deterrent to employee theft, where loyalty and the cost of job loss enter into the equation. Conversely, the longer one is employed, the greater one's knowledge about work practices, work norms, opportunity structures, and security systems, which can increase the likelihood of theft. The data on the importance of length of service is conflicting.

Level of job satisfaction. Many authorities contend that a satisfied employee is less likely to pilfer than a dissatisfied one. Although this is generally true, there are many types of satisfaction and these seem to have a differential effect. Dissatisfaction with one's supervisor or job does not appear to have a significant effect on employee theft; dissatisfaction with the work organization does. Generally, the greater the satisfaction with the work organization, the lower the level of employee theft (Altheide et al.; Baker and Westin; Greenberg; Hollinger and Clark; Horning; Terris; Traub).

Modus operandi

Most employee theft is solitary behavior and does not require special equipment, procedures, or accomplices. Pilfered items are generally hidden on the person, carried in a lunch pail, purse, pocket, or briefcase. Theft at the lower end of the pilfering continuum does not call for extraordinary measures for its execution nor is it at a level that one needs an elaborate justifying rationale. At the upper end of the pilfering continuum elaborate schemes are necessary to move quantities of goods or to appropriate large amounts of money or services. Theft at this level requires a higher order justifying rationale and is less amenable to attempts at legitimization through neutralization of the behavior (Baker and Westin; Greenberg; Hollinger and Clark; Horning; Traub; Weiner).

Donald N. M. Horning

See also Computer Crime; Employee Theft: Legal Aspects; Police: Private Police and Industrial Security; Prevention: Environmental and Technological Strategies; Theft.

BIBLIOGRAPHY

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Greenberg, Jerald. "The Cognitive Geometry of Employee Theft: Negotiating 'The Line' Between Taking and Stealing." In Dysfunctional Behavior in Organizations: Violent and Deviant Behavior, Part B. Edited by Ricky W. Griffin, Ann O'Leary-Kelly, and Judith Collins. Stamford, Conn.: JAI Press, 1998.

Hassett, James. "But That Would Be Wrong: Psychology Today 's Survey Report on Cheating, Lying, and Bending the Rules in Everyday Life." Psychology Today 15 (November 1981): 34–50.

Hollinger, Richard C., and Clark, John P. Theft by Employees. Lexington, Mass.: Lexington Books, 1983.

Horning, Donald N. M. "Blue Collar Theft: Conceptions of Property, Attitudes Towards Pilfering, and Work Group Norms in a Modern Industrial Plant." In Crimes against Bureaucracy. Edited by Erwin O. Smigel and H. Laurence Ross. New York: Van Nostrand-Reinhold, 1970. Pages 46–64.

Luckenbill, Daniel D., Trans. "The Code of Hammurabi." In The Origin and History of Hebrew Law. Reprint. Edited by John M. Powis Smith. Chicago: University of Chicago Press, 1931.

Murphy, Kevin, R. Honesty in the Workplace. Pacific Grove, Calif.: Brooks/Cole, 1992.

Terris, William, ed. Employee Theft Research, Theory, and Applications. Park Ridge, Ill.: London House Press, 1985.

Traub, Stuart H. "Battling Employee Crime: A Review of Corporate Strategies and Programs." Crime and Delinquency 42, no. 2 (1996): 244–256.

Weiner, Alfred N. How to Reduce Business Losses from Employee Theft and Consumer Fraud. Rev. ed. Lanham, Md.: Madison Books Inc., 1998.