How Management Liability Insurance Covers You from Thieving Employees

Among many other risks that a business might face, loss due to thieving employees is one of the most complicated things to deal with. In such cases, a business does not only lose a part of their assets or stocks, but they are also at risk of facing unfair dismissal charges from these dishonest employees. Nevertheless, this does not mean that you should be ignoring these events, particularly if an employee had taken quite a significant amount of assets from you. A good example would be what happened in a coal mine near Newcastle.

Man Hiding Files

According to reports, a 38-year-old mineworker has been charged for stealing over 300 kilograms of copper wire from a coal mine at Black Hill. Police found three 100 kilogram spools of copper wire (worth around $3,500) from the mineworker’s car during a search, the same quantity which was reported to be stolen. This extent of theft could have jeopardised the company’s productivity and bottom line, for although it might seem like a small amount, it could eventually lead to bigger losses if other employees are stealing bit by bit.

What Constitutes Employee Theft

Theft, or the unlawful retainment of the property of another with the intention of depriving the true owner, is an example of serious misconduct, as stated in the Fair Work Act. Employers, however, have to be careful when dismissing an employee due to theft, since some circumstances might only warrant a verbal warning. In any case, an employer must be able to conduct a thorough investigation of the whole incident and should be able to prove the employee’s guilt.

Businesses Reluctant to Apprehend

Unbeknownst to many, employee theft is even more prevalent in recent years than reported. This is because most business owners are reluctant to report or apprehend dishonest employees, particularly those to whom they had developed a close relationship. Theft in the workplace could be anything from small items such as stationery and staplers to bigger ones such as computers and, the most recent one, copper wires. Even intangible assets like trade secrets and time can be stolen.

Moreover, a single case of theft is not a sufficient ground for dismissal, and business owners run the risk of facing an unfair dismissal charge. As most experienced business owners know, having a proper management liability insurance policy, which covers crimes such as employee theft, provides invaluable protection.

Fortunately, most insurance brokers, such as Insuring theProduct, offer management liability insurance in the Sunshine Coast, providing coverage for employee theft and other losses resulting from dishonest acts. With the proper management liability insurance policy, a business can be protected from litigation, significant financial hardship, and would be able to reclaim their losses.

(Source: Copper thievery under investigation, Australian Mining, March 4, 2015)

Keep Up To Date

Join our Newsletter for regular relevant insurance and risk management updates for your business

Explore Insuring theProduct

GENERAL ADVICE WARNING

This advice does not take into account any of your particular objectives, financial situation or needs. For this reason, before you act on this advice, you should consider the appropriateness of the advice taking into account your own objectives, financial situation and needs.

Before you make any decision about whether to acquire the policy, you should obtain and read the product disclosure statement for the policy.

We recommend you read our Financial Services Guide for information on our services and how we are remunerated.