Employee theft is a common problem that plagues pizza chains and independent pizzerias alike. It's not limited to taking moneyfrom the register; employees mightalso steal supplies and inventory,including food, paper products, alcoholic beverages, andoffice and kitchen equipment. They may even cut into the bottomline by granting discounts, refunds or free food to customerswho are not entitled to them; by overcharging customersand pocketing the difference; or by claiming to have workedtime they did not work.
Many employees steal simply because the opportunity presentsitself.Inventory is left unchecked and unlocked, andmanagers arenowhere to be seen. And since pizza restaurants arehigh-volume cash businesses,it can be easy to skim a few dollars off the top during a shift.
Some employees steal because they feelunderpaid and view walking away with “extras” (such as foodstuffs, papergoods, glassware and other inexpensive items) as a deserved“perk” of the job. Finally, a few employees will steal simply because they like the challenge, walkingaway withbig-ticketitems, such as full kegs of beer, cases of wine, laptop computers,kitchen equipment, or cash.
Preventing theftcan seem an overwhelming task. Some employers assume the onlysolutionis to install security cameras throughout therestaurant and constantly monitor employees. While this is helpfulin some cases, there are other, less intrusive (and less expensive)ways to build anenvironment in which employees work together to prevent theft.
Here are some simple ways you can prevent theft in your pizzeria:
1. Check references when hiring. Many employers skipchecking references, assumingan employee would nothave provided a name unless the person would give a good reference.That’s not true. Checking references can lead to importantinformation, including how an employee behaved in a pastjob. Ask questions such as, “Would you trust this person to closethe restaurant?” and “Do you consider the applicant to be honestand trustworthy?” Hire only those applicants who providesolid references. Ask the applicant to sign a release and waiver,authorizing prior employers to talk freely about or provide personnelrecords for the potential hire.
2. Keep morale high and offer bonuses. Employees sometimessteal because theyfeel entitled to more than they are getting paid. Consider offeringfree or discounted food to employees during their shifts. After all,an employee who loves your food will probably sell more of it!Enact a profit-based bonus program that rewards employees fora good month or a good quarter or for keeping to a certain levelof cash-register accuracy. Some employers offer noncash prizes,such as movie tickets or gift certificates to local stores. Get creative and team up with another local business toswap reward items. Let your employees know their hard work isappreciated by hosting an Employee Appreciation Night or givingout Employee of the Month certificates or prizes.
3.Implement and follow clear policies. Provide all employeeswith an updated and accurate employee handbook.Make sure employees know whom to turn to if there is a problem,and have an open-door policy for raising issues to management.If you offer discounts to employees or offerfree meals, maintain written policies outlining the termsand make sure all employees know them.
4.Talk to employees about theft and the cost to thebusiness. In some cases, employees (especially younger employees,who may not have experience purchasing these itemsthemselves) may not realize that taking “just a little bit” of food,a roll of paper towels or a case of soda is truly stealing. They don'tunderstand that all of those items need to be bought andpaid forand that every dollar’s worth of supplies that is stolenis a dollar of profit that is lost.
5. Keep trustworthy managers on every shift.And, on occasion, have that manager takesome time off so that you can spot any irregularities in inventoryor cash flow.
6.Enact safeguards. Safeguards can require only a few simplechanges in procedure. For instance, have a second employeesign off on all refunds or POS changes. Have two employees takeout trash and perform inventory checks, or alternate these duties.Provide each employee with dedicated sign-in info for cashregisters, and have a manager ensure that registers balance atthe beginning and end of each shift.
7.Audit time cards. Ensure that employees are punchingin and out only for themselves and at the times indicated. Thisis especially important if you rely on employees’ written timesheets rather than a time clock to keep track of hours worked.
What Should I Do if I Catch an Employee Stealing?
What if the worst happens and you catch an employee stealing?Your first instinct may be to fire the employee on the spot. Youshould stop and think, however, before doing this. Analyze eachsituation individually. Was the employee stealing cash or goodsor offering improper discounts? Is the person an otherwise goodemployee that you would rather rehabilitate than fire? Are youplanning to report the matter to the police?
Investigate suspected theft as you would any potential workplacemisconduct, such as harassment, retaliation or otherbreach of policy. Be objective, fair and reasonable. Ask questionsof the person suspected of wrongdoing; review available documents,emails or videotapes; and reach a fact-based conclusion.Talk to employees who may have witnessed what you suspectmay have occurred. Don’t make assumptions about what tookplace before finding out the facts. Document the entire processfrom start to finish.
Consider the impact on the workplace prior to taking action.If you opt to discipline or fire an employee, it should bedone privately and out of earshot of other employees. It maybe tempting to “make an example” of someone but, most of thetime, doing that serves mainly to anger the person you’re makingan example of and make other employees feel threatened.Whatever disciplinary steps are taken should be documented inthe employee’s personnel file. Whether to report the matter tothe police is discretionary.
Finally, you might assume that you can deduct the cost of thestolen goods from the employee’s final paycheck but, in manystates, this would be a violation of wage and hour laws. Beforemaking any deduction in an employee’s pay (whether you arekeeping him employed or not), be sure to consult with your localemployment law attorney. Even if the employee agrees topay back the amount stolen, there are limits on how much paycan be garnished each week. Generally speaking, though, theemployer is obligated to pay all wages earned and due to theemployee, even if the employee has been caught stealing. If theemployee is going to pay back the employer, this should be donein a transaction that is separate from payroll.
Employee theft has been a problem as long as there have beenemployers and employees. By taking steps to improve the workenvironment and employee morale and by safeguarding cash,inventory and equipment, employers can reduce the impact ofemployee theft on their bottom line.
This article was adapted and edited from 2012 article, "Managing Employee Theft."