Employee fraud a big risk for tradies
With many people facing tough financial times, employee fraud is a growing risk for tradespeople.
As construction sites pose a range of opportunities for employee fraud and theft, tradies need to know the potential risks their business faces.
According to the most recent report from the association of Certified Fraud Examiners, the average firm loses 5 per cent of its revenue annually to employee fraud.
Small businesses were the hardest hit by employee fraud. According to the survey, smaller firms suffered the largest median losses.
Employee fraud can take a number of different forms and is a threat for every business owner.
For many tradies, employee theft will be a big challenge. Tools and machinery are already appealing targets for thieves and there is always demand for stolen tools.
Another part of the risk for the trades industry comes from exaggerated injury claims. Given the dangers that exist on building sites, the potential for inflated injury claims by unscrupulous employees is a real threat for tradies.
There are a few simple ways to ensure that your business is not a victim of employee fraud:
- Ensure that tools and machinery are accounted for. Every tradesperson knows that tools are easy to steal and expensive to replace. Regularly auditing the tools your business owns will help to detect any missing items and deter employees from potentially stealing from you.
- Maintain a safe work space. Ensuring that your construction site is safe and poses as little risk as possible will limit the chances for employees to make injury claims of any kind, in turn limiting the risks for business. When it comes to workplace safety, prevention is definitely the best cure.
- Make sure your insurance provides cover for workers compensation, public liability, tools and machinery. When trouble does strike your business, insurance cover can make a big difference for your company's survival and profitability. If you are unsure about your levels of insurance cover, make sure you consult with an insurance broker to determine your liability to employee fraud.