All in a day's work: A pre-Christmas pay rise?

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Jingle bells, jingle bells, jingle all the way,

December's here, Christmas is near, there are lots of bills to pay...

Apologies to the original writer of Jingle Bells, for my markedly less catchy version!

Apparently, another (and perhaps not unexpected) consequence of the recession has been an increase in employee theft and fraud. With financial pressure mounting, some employees have been driven to, shall we say, supplement their incomes with a little creative accounting.

Add Christmas and the associated financial pressures into the mix, and I suspect this unfortunate trend may continue into 2011.

One recently convicted 'fraudster', Julia Jose, was employed by the Wellington Regional Chamber of Commerce, in the role of Finance Manager.

After seven months the Chamber of Commerce went back to the recruitment company they had used, reporting that Ms Jose didn't even have a rudimentary understanding of accounting practices (which one might reasonably expect with a Finance Manager).

Some (perhaps belated) reference checking was carried out, and it transpired Ms Jose didn't have the qualifications and background she had purported to have. Sensing, I suspect, that the writing was on the wall, Ms Jose resigned.

However, subsequently the organisation discovered her understanding of accounting practices extended far enough for her to have been able to steal the sum of $54,000. A prosecution for theft and fraud ensued.

More recently, a chartered accountant lost his application for name suppression in relation to his conviction on seven fraud charges. Mr Benjamin had wanted a salary of $180,000 from his employer, then called HortResearch, but ultimately accepted $165,000.

He then apparently authorised a pay increase for himself to $175,000. He also, tampered with the computer payroll system so that it recorded his salary as being $165,000 - most likely to avoid his changes being detected. What may have been looking like a very Merry Christmas, looks decidedly less festive for Mr Benjamin, who will be sentenced on 21 December 2010.

These cases don't often appear as employment cases, despite the fact that they involve employees stealing from their employers. Presumably the convicted fraudster does not try to challenge his or her dismissal!

The lesson for employers is to be vigilant, and to ensure you have checks and balances in place to detect employee theft and fraud. And where you do have any suspicions, act quickly to seek professional advice about investigating those suspicions.

The lesson for employees is simple too - like that last piece of Christmas cake or that extra mince pie: Just because you can - doesn't mean you should!


Bridget Smith is an employment lawyer at Minter Ellison Rudd Watts