My Employees Are Stealing Clients – What Can I Do?

Some businesses are open to employees stealing clients, especially new software start-ups such as web design firms. Where the business relies on multiple employees with a certain skill set that can be sold on the open market this problem exists, not only because it is easy and tempting but because it is lucrative. It also happens the other way around, of course. Competitors poaching your employees can be just as potentially devastating for your business and is becoming more and more commonplace as profit margins tumble and businesses look for any advantage or leverage that they can get in a market place.

There are a number of things that you can do to help prevent your employees stealing customers but, at the end of the day – it happens in all industries and it might not be something that you can totally prevent. The best you can do is help mitigate the situation by some or all of the following means.

1. Create total employee loyalty

If you can create the perfect working environment with the perfect pay scale and can afford to pay high wages then you are halfway towards creating an employee who will show loyalty and not go off after your clients hoping to pocket 100% of the cash for themselves. Some of the things that employees crave are great working conditions, flexible hours, great pay, a sense of a team community and friendly environment and company perks – including pensions, health schemes and other bonuses. Besides, not all staff want to go off and work in their bedrooms or from a home office. If you can create the idyllic working environment for them they are less likely to go off on their own – taking your customers with them.

2. Ensure that intellectual property and assets are protected

You may need to take legal steps to ensure that patents and other intellectual property is protected. This might mean that you need to compartmentalize information, get your employees to sign non-disclosure agreements, and ensure that communications and networks are totally secure from pilfering. Only trust your main company secrets, lead lists and anything giving you a competitive edge to those that you truly trust.

3. Monitor your workplace environment and communications

If you install monitoring equipment on work phones, introduce CCTV at point-of-sale and other security measures, employees are less likely to risk getting caught on the take or stealing your leads. They also know that you are carefully guarding the company assets and will be aware of the consequences of and difficulty in trying to steal customers or receive any personal gain from favours given, back-handers and skimming. Cell phone monitoring can be particularly important in this respect, not only from the fact that you can track and monitor call, texts, IMs and emails but you can also keep a handle on the location of your sales force etc. through using GPS tracking. For driving, courier, sales teams etc. this can be a large disincentive for employees to try go to your clients behind your back and try to do business on the quiet.

4. Deal with inappropriate behaviour quickly and harshly

Use the full extent of the law, including disciplinary hearings, suspensions, legal recourse and dismissal if any of your employees act inappropriately towards you as business owner, towards the business in general or towards any of your intellectual property or assets. Always be mindful to remain within employment law, but never let anything go as it will act as an invite to others who may be tempted down the same path.

5. Employ 3rd parties for security, surveillance or covert operations

This only comes into play if you have a real suspicion that an employee is acting against the interests of your business. There are 3rd party companies out there that can ensure that your security, both physical and I.T. / communications-wise are up to scratch. You can also use monitoring solutions as above that can be installed quickly and efficiently and at relatively little cost to cell phones, computers laptops and other company equipment. This is usually available online and the tech savvy can install such equipment themselves but don’t be afraid to call in a consultant if necessary. If the worst comes to the worst and you need to employ covert or surveillance operations against staff that you feel might be fleecing your business then so be it, but again, ensure that you consult a lawyer first and only act within the law.


Computer Fraud and Abuse Act – Wiki

SBA – Stop Employee Poaching

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