Buddy says:  Firstly, investigations to find out how and why money has gone missing should be carried out.  Wrongfully accusing a employee of theft, or deducting money from wages when your suspicions are unfounded could have detrimental effects on the employment relationship and could even lead to that employee resigning and claiming constructive unfair dismissal.   

Even if you can prove that money was stolen from the business, it is unlawful to make a deduction from a worker’s wages unless the deduction is required or authorised by either statute or a provision in the Workers contract, or unless the Worker has given their prior written consent to the deduction. Therefore the workers contract (or a subsequent consent from her) must give you the right to deduct such sums from her wages. 

If it turns out that money has been stolen from the business, disciplinary action against that employee should be considered.

If an Employer attempts to recover payments in breach of the provisions for unlawful deductions from wages, contained in sections 13 – 27 of the Employment Rights Act 1996, then they risk losing the right to recover the sum at all.  Therefore, as an employer, if you anticipate needing to recover sums from Worker’s in certain circumstances it is best to have a clause inserted into the contract of employment, and also have the Worker sign a written permission before making the payment.