Can an Ex-Employee Sue for Damages Due to Theft of Company Items?

In the dynamic world of business, the relationship between employers and employees can sometimes turn sour. This includes situations where a former employee commits theft, causing significant damage to the company. This article explores whether an ex-employer can sue for damages caused by an ex-employee's theft and outlines the necessary steps and steps to take.

A Step-by-Step Guide for Ex-Employees Thrown into Criminal and Civil Actions

Theft of company items by an ex-employee can result in severe consequences for both the employee and the employer. An ex-employer has the right to file a lawsuit for damages caused by the theft. The process typically involves several steps:

File a Police Report: The first crucial step is to report the theft to the police. This action is not only for legal reasons but also to document the event formally. However, it's important to note that the police may have limited resources and might not take immediate action. This step sets the stage for any future legal action. Consider Criminal Charges: If the theft is significant and rises to the level of criminal activity, the ex-employer may pursue criminal charges. In such cases, it's essential to ensure that the state also seeks restitution for the losses caused. Restitution can help mitigate some of the financial damages. Initiate a Civil Lawsuit: Beyond reporting to the police, the ex-employer can file a civil lawsuit to recover damages. This step is necessary to reclaim financial losses and other damages caused by the theft. It's essential to gather all relevant evidence, such as video footage, witness statements, and any other documentation that proves the theft and its impact.

A True Account of an Employee Theft

I encountered a situation where an employee stole $2,600 in cash, and the theft was captured on video. Despite taking a police report, the police took no action, and when followed up, the individual showed no indication of resolving the issue. The case in Arizona is a Grand Theft case, where values above $2500 trigger serious legal repercussions.

The scene of the theft was discussed over the phone, during which the former employee inquired about the company's insurance coverage and whether a claim had been filed. When I informed him that the case didn't need to be handled through insurance and that the theft had already been reported, he promptly hung up, saying 'case closed.'

Understanding the Legal Landscape

The legal stance on ex-employee theft is unequivocal in almost all jurisdictions. If the theft causes damages, both criminal and civil actions can be pursued. If an ex-employee steals valuable company assets such as source code, leading to the need to delay the launch of a product or any other form of demonstrable loss, legal consequences can be severe.

It's crucial to understand that proving the theft and the resulting damages can be challenging. Ex-employers must be able to present evidence that clearly shows the theft occurred and the extent of the damages sustained. For instance, if a former employee stole 2600 cash on video, the proof is relatively clear. If the theft involved more abstract assets, it may be more difficult to prove the extent of the damage.

Real-World Examples and Lessons Learned

One of the most significant theft cases I handled went undiscovered for over 20 years. The defendant became complacent, and the theft was only discovered through a routine investigation into similar transactions. We recovered several million dollars, demonstrating the importance of thorough investigation and documentation.

For smaller cases, some were handled through civil lawsuits, while others offered the opportunity to restore the stolen items in exchange for merciful treatment. Some instances required reporting the theft to the authorities due to the high value of stolen items or to mitigate broader risks to the company.

The Bottom Line

The best advice for employers is to avoid situations where an employee can steal from the company. A zero-tolerance policy and robust auditing processes can help identify and prevent such issues. Trust is crucial, but it must be balanced with security measures. This can help protect both the company and the employees from the potential negative consequences of theft.

In conclusion, while pursuing legal action for ex-employee theft can be challenging, it is a viable option if backed by strong evidence. Employers should take necessary precautions to prevent such incidents and be ready to act when they occur.