Employee Theft

Employee theft accounts approximately 1/3rd of all loss in a typical retail store according to the NRTA and other sources. While employers like to believe that their employees are honest, employee theft is a huge problem. There is no logical reason to conclude that employee theft is not a problem at your store.

Not only will a dishonest employees cost you money by outright theft, hiring an employee with a questionable background could result in a lawsuit and the worst kind of public relations. What can you do to protect yourself, your business and profit from the worst kind of employee? It is simple, not easy but simple, do your homework. With unemployment at an all-time low and good employees hard to find it is tempting to hire quickly but if possible it might be better off paying overtime to current employees and spending the time (and money) researching potential employees. The number one way to do employee screening according to NRF is multiple interviews NRSS Industry Research Survey 2017, ideally by more than one person in your business. Using the "numerous interview approach," you are more likely to get a real sense of who this potential employee is. Other methods of pre-employment screening include, but are not limited to:

Background Checks: A background check is a widespread method of pre-employment screening. During a background check the applicant’s, criminal, financial and personal records are reviewed and any red flags investigated. There are many resources, some free and some with a cost available.

Pre-Employment Drug Screening: Employers use drug testing to avoid employing people with drug-related issues. Drug screening is required for federally-regulated industries that hire for safety-sensitive jobs. Some employers overlook cannabis use however if your business is regulated by the federal government you are required to test for cannabis use and treat it as a violation.

Personality Tests: Personality test assessments can tell you the applicant’s reasoning skills, honesty, current, and potential skills, personality and more. This information can be helpful in finding the best employees for the job and weed out potential problems. If an 

employee is placed in a position that doesn’t match her or his personality, it does not work for anyone involved often leads to low employee engagement, roughly 20 percent lower productivity almost 50 percent higher turnover. There are many personality tests available on the market.

Credit Checks: Doing a Pre-employment credit check will look at the 7-year financial history of the potential employee and uncover any areas of concern. It will usually include collection accounts, public records, bankruptcies, charge-offs, judgments, payment histories and more. Credit checks can uncover habits that include living beyond their means and incurring massive debts with no means of repayment. Hiring someone who is financially irresponsible could well impact the work environment and your bottom line. Pre-employment credit screening does not include the credit score.

Social Media Screening: "Pause before You Post,” in an apt phrase trademarked by Jostens the class ring company. Good advice for young people and anyone. Even the smallest post can come back to bite you. Employers use social media for looking into personality traits, alcohol or drug abuse, or any other characteristics that could affect, positive or negative, on your business. Be careful screening social media to gain insights on potential employees can also get you in legal trouble, so it’s best to consult your attorney.

The benefits of pre-employment screening outweigh the costs, time and hassle. Correctly screening potential employees will increase the quality of that employee, improve customer satisfaction, lower your loss, help you to sell more, lose less and protect your investment.

Conducting pre-employment screening is essential for your bottom line; it is well worth the effort and does not have to be hard. When it comes down to it trust your gut or even better multiple guts, that’s why it is sometimes wise to have more than one person in the company interview a candidate.

Bonus Tip: “Shrinkage is not just another cost of doing business. It is a cost that can be controlled.” James L. Goss, VP & Treasurer -Sprouse Reitz Stores -Mark Turner