Ways To Protect Your Business From Employee Theft & Fraud
New Jersey businesses are vulnerable when critical, confidential information is given out to employees and misused. Whether an employee is fired, quits or still works for the company, employer protocols are vital to protecting the company from fraud and theft by the employee.
According to Entrepreneur, companies should have a code of conduct. This is basically a statement that the company will not tolerate illegal or unethical behavior toward suppliers, customers, the company or employees. This code of conduct should be strictly spelled out for employees and include the results of not following them.
Along with a code of conduct, companies should have a system of checks and balances. When one person is tasked with controlling too many aspects of the business, there can be problems with employee theft. At the minimum, there should be a type of operation where one person handles anything that goes out like payments, finished products and orders, and another one handles things that come in such as merchandise, supplies, checks and cash.
Companies should also have procedures and policies in place to minimize risk. An example of this is that one person should handle the credit card and bank statements every month, and that person should not be able to modify or enter transactions into the company’s accounting system. When one person is required to multi-task too many things without someone checking their work, it is easy for mistakes to happen.
According to CNBC, it can be extremely difficult for a small business to survive in New Jersey. Policies and procedures that protect against employee theft help guard companies from the inside.
Understanding how this affects the small business economy is part of our job here at Santomassimo Davis LLP, as we primarily focus in providing expert Outside General Counsel for a variety of law firms and legal issues related to Employment & Labor Counseling and Litigation in New Jersey, New York and Pennsylvania.
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