Barry Jones' business is not one of New Zealand's biggest or most high-tech companies.

But it's one of many small- and medium-sized companies that are investing in security cameras as a way of monitoring activity on their premises.

That investment paid off when he caught a staff member helping herself to goods from the service station in Ashhurst, near Palmerston North, and had the evidence to back up her dismissal when she appealed against it to the Employment Relations Authority.

The employee was ordered to pay $7000 in legal costs when the authority upheld her sacking for taking goods and stock from the company.

Jones said he initially installed cameras to address problems with customers driving away without paying for petrol, or claiming they had been short-changed.

He discovered the problem was internal when he began reviewing camera footage to get a better idea of the type of customers using the station's new food bar because sales and margins were falling.

"I thought maybe we had the wrong mix of people working at a particular time, or we weren't giving the customers what they wanted," he said.

"Then at the end of the tapes I noticed this person walking out the door at the end of her shift with a whole lot of bags.

"I checked and none of our usual procedures had been followed in terms of taking stock out of the building, and there was no receipt in the system for what she'd taken."

He called the worker in to explain what she was doing and despite her claims that she had paid for the goods, determined that she had taken property without paying. He used till receipts and bank statements she provided to back up his actions.

The authority said the worker "clearly appreciated that the respondents were justifiably attempting to investigate her conduct, as recorded by the security surveillance footage".

It found the worker then "raised her employment relationship problem in bad faith." The authority said these actions amounted to "attempted extortion". It said her case had no chance of success and ordered her to pay Jones' legal bills.

The worker, who has been interviewed and warned by police, could not be contacted for comment.

Jones said the cameras allowed live footage to be viewed off-site but he hadn't used that feature.

"I always trust my staff. Some people say that's asking for trouble but I'm pretty old school about it, I just trust people.

"Usually there's something that makes you look; a gut feeling, body language, talk that you hear around the place or an area of the business that's not going well."

He added that although security cameras were a useful tool, employers also had to have stringent procedures in place.