Employee fraud and theft

Whilst it’s not a risk you like to think about, the possibility of internal theft or fraud is one anyone who has employees or places trust in a contractor needs to take heed of.

There’s a variety of ways a worker might betray the trust they have been given, including:

  • falsifying their qualifications and/or employment references;
  • manipulation of invoices, receipts, bank account details and other financial documents;
  • leaking exclusive data, sales leads and/or professional partnership terms which competitors have an interest in;
  • misusing their official work hours or abusing flexible working time systems; and/or
  • faking or exaggerating claims for travel expenses and client entertainment costs.

Many employees that commit fraud will do it for their own gain, but in some cases the organisation may be infiltrated by an organised criminal gang.

Key actions to prevent employee theft and fraud

  • Understand what you have that may be targeted by a fraudster and design suitable measures to reduce the risk. For example, finance processes (including procurement and payments, accounts) should be overseen by senior employees to ensure one person can’t transfer assets by themselves.
    • Perform regular checks and audits to ensure the fraud prevention measures are being followed so that access to key assets is effectively restricted.
  • Ensure good key security and access code management practices for all external doors, safes, stock rooms, vehicles, storage containers, cupboards, etc.
    • Don’t forget to consider who can access intruder alarm and CCTV systems.
  • Obtain (and thoroughly check) at least two independent references for prospective employees.
  • Take note of behavioural changes amongst your workers.
  • Don’t allow lone working, as much as is possible, and set up whistleblowing methods that allow anonymous reporting and protection for those voicing their suspicions.
  • Issue a clear anti-fraud policy statement and ensure all employees receive training on fraud prevention and that they know how to report any concerns they may have.
  • Install tracking, telematics or other similar systems to your owned vehicles and have a robust key security system for other vehicles your business may be taking care of (i.e. in the motor trade industry).
  • Set up various security precautions and measures for computer data and connected devices. Review our risk topic pages on cyber threats and data management for guidance regarding this.
  • Enforce a ‘clean desk’ policy so confidential papers are locked away when not in use.
  • Establish a system of recording issues and return of devices, tools and equipment.
  • Put procedures in place for the exit of an employee who has access to confidential data and/or information. ‘Gardening leave’ is a common practice, where an employee whose employment has been terminated, or who has resigned, is immediately instructed to stay away from the premises during their notice period so they can’t obtain up-to-date sensitive information.

This article is adapted from an original post by Allianz which can be found here.


Employing young people

Young people can be keen to learn and may bring fresh perspectives and ideas into the workplace.

However, their capabilities are generally less developed than those of experienced and mature employees and their individual characteristics must be taken into account. Young people new to the workplace environment outside the education system may be eager to impress or please others, but they can’t be expected to be aware of the hazards and potential risks to themselves or others.

There’s a wide range of legislation concerning the health, safety and welfare of young people and there’s a special focus on the provision of information, training and supervision to meet their particular needs.

A young person can’t be employed for work which is beyond their physical or psychological capacity, or work which involves:

  • harmful exposure to radiation or toxic or carcinogenic agents that might cause heritable (genetic) damage or chronic health problems;
  • a risk of accidents they may not be able to appropriately recognise or avoid, due to their lack of experience, knowledge or training; or
  • a risk to their health from extreme cold or heat, noise or vibration.

There can be exceptions to these prohibitions where it’s necessary they carry out the work for their training, provided the young person is supervised by a competent person, and any risk is reduced to the lowest level reasonably practicable.

This risk topic looks at the more common hazards that should be considered to safeguard the health and safety of anyone under the age of 18, and above the minimum school leaving age (MSLA; fixed at the last Friday in June of the school year (1 September to 31 August) in which the child reaches the age of 16). Our risk topic page on employing children provides guidance about the health and safety at work of a child below the MSLA and students involved in work experience.

Working time limits for young workers:

The regulations regarding working time are complex, but, to summarise them briefly, the main limitations and requirements for young workers are:

  • A maximum working time of eight hours a day and 40 hours per week, and an uninterrupted 30 minute in-work rest break when working longer than four and a half hours. College time doesn’t count as work, unless it’s part of job-related training.
  • The limits in (a) don’t apply where the work by the young person is necessary to maintain continuity of service or production, or to respond to a surge in demand for service or product, provided that there is no adult available to perform the duties and the young person’s education and training needs are not adversely affected.
  • 2 consecutive hours’ rest in any 24-hour period.
  • A two day rest period in each seven day period.
  • In general, young persons are not allowed to work at night or within the ‘restricted period’, i.e. between 10pm and 6am (or between 11pm and 7am if contracted to work after 10pm).
  • The prohibition in (e) doesn’t apply in the circumstances outlined in (b) to a young worker in a hospital or similar establishment, or in connection with cultural, artistic, sporting or advertising activities.
  • The prohibition in (e) doesn’t apply in the circumstances outlined in (b), except where it prohibits work between midnight and 4am in agriculture, retail trading, postal or newspaper deliveries, a catering business, a hotel, public house, restaurant, bar or similar establishment, or a bakery.
  • Where the exceptions in (f) or (g) apply, the young worker must be supervised by an adult worker where necessary for the young worker’s protection, and allowed an equivalent period of compensatory rest.
  • A free assessment of health and capabilities must be provided prior to assignment to night work and at regular intervals thereafter.
  • Detailed records must be retained for two years.

Key actions to safeguard young workers

  • Identify the prohibitions, restrictions and specific duties defined in health and safety law and the rules set out in the Working Time Regulations.
  • Assess the health and safety risks and suitability of the proposed work before recruiting a young person.
  • Check what specific prohibitions and/or requirements, restrictions or recommendations apply to certain types of work or use of equipment. A young person may operate high-risk machinery (except lift trucks on dock premises) during training, but only if they’re sufficiently mature and appropriately supervised, until they can demonstrate the appropriate level of competence to work safely unsupervised. Examples of work and equipment that is usually prohibited for young people include:
    • High-risk woodworking machinery which is hand-fed – in particular, a sawing machine fitted with a circular blade or band saw, a planing machine when used for surfacing or a vertical spindle moulding machine.
    • Power presses.
    • Lead smelting and refining processes and lead-acid battery manufacture.
    • High-risk lifting machinery, e.g. cranes, construction site hoists and fork-lift trucks.
    • Agricultural and horticultural vehicles and machinery.
    • Work on docks, in compressed air, underwater, involving the carriage of dangerous explosives and goods or shipbuilding and ship repair.
  • Check that the standard induction training is appropriate and suited to the needs of the young person and ensure that the induction includes employees’ responsibilities.
  • Implement suitable training programmes for young workers.
  • Inform young workers of the risk to their health and safety (as you should for all employees) and provide, free of charge, any personal protective and safety equipment.
  • Provide information, instruction and training prior to commencement of the work and provide time for the young person to ask any questions.
  • Complete a specific risk assessment, taking into consideration the young person’s proposed work, lack of experience, maturity and hazard awareness before they start work. Take account of their individual characteristics, for example:
    • background influences, such as family, cultural or religious beliefs, or social pressures;
    • unfamiliarity with the workplace and the nature and organisation of processes and activities;
    • their stature and physical needs and how these correspond with the ergonomic design of the workplace and workstations or affect their ability to endure or recover from exposure to physical, biological and chemical hazards;
    • a limited appreciation of the workplace hazards;
    • a need for tailored formats or more time to take on board the information, instruction and training given to them (due to the unfamiliarity);
    • the temptation to take shortcuts, misbehave (often as a result of peer pressure) or copy the unsafe practices of others;
    • a lack of experience dealing with violent or aggressive behaviour or unauthorised initiations they may be faced with; and/or
    • a lack of confidence or reluctance to ask questions or report issues.
  • Maintain appropriate levels of supervision during and after the training of the young worker(s).
  • Monitor compliance by conducting regular reviews with the young worker(s) and their appointed trainer(s)/buddy.
  • Review the risk assessment if circumstances change and at regular intervals.

To find out more about how you can provide a safe working environment for your employees please visit the HSE website.

This article is adapted from an original post by Allianz which can be found here.


What’s the difference between a labour only subcontractor (LOSC) and a bona fide subcontractor (BFSC)?

And when you need employers’ liability insurance.

What is a labour only subcontractor?

Labour only subcontractors are usually hired to assist with a build project when extra help is required.

Labour only subcontractors become part of your team and work under your supervision, using tools, equipment and materials provided by your business.

As they are employed for the duration of the build project, you are required to pay them the same wages as your full-time staff. You become responsible for their health and safety while they are at work. This includes making sure you have employers’ liability insurance.

What is a bona fide subcontractor?

Bona fide subcontractors are hired to complete a specific job—such as plumbing or electrical work—on a build project that your full-time staff is not capable of completing on its own. As your firm would be hiring them for a specific job, you would pay them as if it were a normal separate job, typically via invoice. In addition, because they are working independently of your firm, bona fide subcontractors should have their own liability insurance and invoices will include VAT.

Do I need employers’ liability insurance for contractors?

Employers’ liability insurance covers you in the event that one of your employees is injured or becomes ill due to the work they do for you and decides to make a claim against you.

In the majority of cases, employers’ liability insurance is a legal requirement if you have employees, this includes employees who work for you on a short term basis.

An exception to this rule is that you don’t need employers’ liability insurance if you only hire independent, self-employed bona fide subcontractors. So, check the criteria above to ensure you’re working with bona fide and not labour only subcontractors.

You do need employers’ liability insurance if you hire labour only subcontractors, even if you only hire them to assist you with one project.

Have you got it right?

If you’re unsure about employer’s liability insurance and the differences between labour only subcontractors and bona fide subcontractors, speak to your broker today for peace of mind.

Re-opening in the wake of COVID-19

Return to work

The coronavirus (COVID-19) pandemic has interrupted many businesses across the country. While it’s unclear how long COVID-19 will continue to affect organisations, many employers are looking to the future of employees returning to work.

Safe reoccupation of buildings

It is a good idea to perform a risk assessment of reopening before reoccupation takes place and to check that the premises are safe to receive returning employees. If you own the premises you are responsible, but in offices that are rented, obtain confirmation from the landlord and keep this on file.

Steps that might need to be taken include:

  • Safe reinstatement of power and gas supplies by a trained professional.
  • Safe reinstatement of heating, ventilation, and air conditioning.
  • Ensuring lifts/escalators have been checked and certificates have not expired.
  • Water supplies need to be reinstated and Legionella checks performed. Water that has been standing in tanks carries the risk of bacterial contamination that can cause Legionella disease. This is especially important where shower facilities are provided for employees. Cold water systems should be maintained, where possible, at a temperature below 20°C. Hot water should be stored at least at 60°C and distributed so that it reaches a temperature of 50°C within one minute at the outlets. Public Health England has published an information sheet. The Health and Safety Executive (HSE) also has more information on its website. For multi-tenanted premises, it is important to liaise with the building manager on a strategy for safe social distancing in shared areas and what the protocols will be for the use of lifts and stairwells, for example, one-way systems.
  • Consider deep cleaning of the office by a professional contractor.
  • You may need to re-configure the office to ensure that social distancing can be observed. This could also include meeting rooms, cafeterias/kitchens and reception areas. Consider the layout of desk banks and possibly use perspex screens where necessary.
  • Assess whether social distancing can be achieved in toilets and canteen facilities. You may need to stagger the use of these facilities and supervise or control entry and exit.


Employee and visitor information track and trace

It is good practice to collect the following information where possible:


  • The names and contact details of employees who work at the premises. (You may already have this information for payroll purposes.) However, you need to consider and ensure that it is also recorded for temporary and agency workers. The same applies for those visiting from another of your office locations.
  • A contact phone number for each employee.
  • The dates and times that people are at work (Shift Rota).

Customers and visitors

  • The name of the customer or visitor. If there is more than one person, then you can record the name of the ‘lead member’ of the group and the number of people in the group.
  • A contact phone number for each customer or visitor, or for the lead member of a group of people.
  • Date of visit, arrival time and, where possible, departure time.
  • If a customer will interact with only one employee, that name is to be recorded alongside the name of the customer.
  • No additional data needs to be collected for this purpose and remember your obligations under the Data Protection Act.

The NHS has published guidance on track and trace for businesses to support the national effort.

Risk management

While the risk of Covid-19 cannot be eliminated in the workplace, there are plenty of practical steps you can take to mitigate the risk:

  • Consider a phased re-opening of the office. This could entail splitting the workforce in half and having each cohort work alternate weeks from home. This would make social distancing plans more attainable and mitigate the risk of all your employees falling ill simultaneously should an outbreak occur at your premises.
  • Where practical, encourage able bodied employees to use stairs to minimise use of lifts of a group of people.
  • For larger work forces, consider staggered start/departure times to avoid congestion in lobby areas.
  • Look to provide the necessary Personal Protective Equipment (PPE). Identify employees who are more vulnerable to the virus and advise them to stay and work from home.
  • Confirm with all employees that they are symptom free before they are allowed to return to work. Furthermore, confirm that they have not been in contact within the last 14 days with someone who has had, or is suspected to have had, Covid-19, or someone who has been required to self-isolate with suspected Covid-19.
  • Ensure that hand sanitisers/hand washing stations are conveniently located.
  • Establish protocols for meeting rooms – what is the maximum capacity in each to ensure safe social distancing?
  • Minimise the number/frequency of physical meetings with customers or vendors by using technology.
  • Put in place a ‘traffic’ system for employees to safely navigate the office and maintain social distancing. Post clear signage so that staff and visitors are reminded to sanitise their hands upon entering the premises.
  • Arrange seating in waiting areas to ensure social distancing. At reception, erect a perspex screen to protect a receptionist.
  • Confirm all necessary insurance policies are in force and that insurers are aware of your re-opening schedule and operational status.
  • Institute a regular and thorough cleaning regime.
  • Revisit fire/evacuation plans in light of Covid-19. For multi-tenanted buildings, liaise with other occupiers to develop an overall evacuation strategy.
  • Have a clear plan should an employee develop symptoms

Review HSE COVID-19 information and guidance on social distancing as well as government advice on working safely during COVID-19.

Document your work

It is important to evidence the work you have done to reopen your business and to mitigate the risk of Covid-19 affecting employees or visitors on an ongoing basis. To this end, it is a good idea to document the following:

  • Assess: review all areas of work activity, look for contact points between employees and others, possibly any members of the public or delivery drivers and consider / reassess if these can be managed within the current social distancing guidelines. Update your risk assessments to reflect any changes.
  • Train and inform: communicate with your employees and customers about what the new changes may mean, ensuring that they fully understand and above all document and record all training and information going forward. It is important that all employees are trained in the requirements of your re-opening plan. It might make sense to circulate the plan to seek confirmation that employees have read, understood and will comply with it. Make sure that they understand fully how to manage the social distancing guidelines and the importance of regular handwashing.
  • Clean: review welfare arrangements and facilities provided.
  • Document: It is good practice for all risk assessments, actions, plans and procedures to be documented – you may be required to produce evidence of compliance to a regulator. Monitor and Review: It is also a good idea to closely monitor the reopening phase closely and review your plan regularly in light of any developments to ensure all is well and up to date. Update: your Business Continuity Plan (BCP) plan in light of Covid-19 and how it would respond to a second wave/lockdown.

Useful information/links:

Get help and support in the different parts of the UK from Public Health England, Public Health Wales, Health Protection Scotland and Public Health Agency (Northern Ireland).