Study finds employee theft on the rise
A report by Jack L. Hayes International, a loss prevention and inventory shrinkage control consulting firm, found that both shoplifting and stealing by employees are increasing, although the latter is growing at a faster clip. An annual survey of large retailers found that shoplifter apprehensions and recovery dollars rose 5.8% in 2011, while the same measurements applied to dishonest employees increased 11.4%.
“It should also be noted that shoplifter apprehensions and recovery dollars have increased eight of the past 10 years," said Mark Doyle, president of the Wesley Chapel, Fla.-based firm.
Broken down even further, shoplifter apprehensions rose 6.0% and dishonest employee apprehensions rose 3.3%; the recovery dollars from these apprehensions was up 13.9% for shoplifters and 5.6% for dishonest employees.
The 24th Annual Retail Theft Survey involved participants from 24 large retail companies with 18,518 stores and more than $589 billion in retail sales last year. On a per-company basis, one in every 36 employees was apprehended for theft from their employer in 2011 (based on more than 2.8 million employees). On a per-case average, dishonest employees steal approximately 5.9 times the amount stolen by shoplifters ($665.77 versus $113.30).
For more survey results, visit hayesinternational.com.
Incentive compensation tips and pitfalls shared
Orlando, Fla. — Incentive compensation should directly communicate an organization’s objectives to employees, so why do so many plans fall short of success? In presentations at the 2012 WorldatWork Total Rewards Conference here May 21 to 23, 21012, compensation specialists shared lessons on the effective use of incentive pay programs and warned of errors to avoid.
“First, determine the business strategy and objectives that incentives are intended to drive,” advised Jason Adwin, senior consultant at Sibson Consulting. “The role of incentives is to motivate and engage employees in order to drive intended business results, and reward and differentiate employees fairly for the value they create,” he noted. “Some employees are going to give above and beyond, with or without incentives. But the program, by sharing their success stories and modeling their behavior, motivates the others.”
“Know what you provide vs. the market and use it to your advantage” for recruiting talent and ensuring engagement among employees, recommended Elyse Lyons, senior consultant at Sibson Consulting, who co-presented with Adwin.
According to Lyons, incentives don’t work when they become an entitlement, leaving employees disappointed if incentive levels decreases from one year to the next.
Another pitfall: confusing metrics with no clear line of sight, requiring multiple Excel spreadsheets to explain and track. “Employees should be able to figure out the incentive plan on a paper napkin,” Lyons argued.
Also beware of plans that demotivate high performers through insufficient differentiation, and misaligned efforts that result when teams have conflicting incentives. “One sign of misalignment is when c-suite executives earn incentives and middle management doesn’t,” Adwin noted, adding, “When individual, department and organizational incentives align, employees can see how their actions help the organization to succeed.”
Another common mistake, Adwin pointed out, is requiring effort beyond everyday job responsibilities to earn incentive pay. Instead, incentives should reward excellent performance within an employee’s normal job duties if that performance is an outsized contribution to the organization’s success.
Bonus amounts that don’t seem large can change behavior for the better, Lyons noted. She related how when the former Continental Airlines wanted to improve its poor on-time departure record, the airline began offering a flat bonus of $65 a month to members of crews with the best on-time departures. As a result, pilots started helping flight attendants clean up plane cabins to ensure timely departures.
“Train your managers to explain that, when incentives are not earned, ‘the performance of our business would not allow us to give the incentive you wanted,’ ” said Adwin.
During another session, Carrie Ward, director of consulting services at SalesGlobe, suggested informing employees’ spouses about incentive pay programs so they can encourage their spouses to strive for those higher rewards. “Send incentive program information to home addresses,” she recommended.
Stephen Miller, CEBS, is an online editor/manager for SHRM.
Have HR-related questions and concerns? Get access to essential forms, policies and guides, plus a live call center, at ToolkitHR.com, powered by HCN and the Society for Human Resource Management (SHRM).
Contractor wins $2.5 million in nail gun case
A jury in San Bernardino Superior Court has awarded a contractor $2.5 million in a product liability lawsuit against tool manufacturer Hitachi.
Martin Oliver, a journeyman carpenter with 40 years of experience, was severely injured when the nail gun he was using, a Hitachi NR83A, discharged a nail into his head, penetrating his brain and leaving him permanently disabled.
The jury concluded that the nail gun was defective because it had a contact trip mechanism, which allows a nail to be fired when the nose of the nail gun is in contact with a surface and the trigger is pulled, regardless of the order in which those events occur. The fact that Hitachi’s gun didn’t have a sequential trip mechanism, which allows a nail to be fired only if the trigger is pulled after the gun’s nose contacts a surface, constituted a design defect, according to the decision.
Hitachi could not be reached at press time for comment. The plaintiff was represented by personal injury attorneys Roger Gordon and Vincent Vallin Bennett of Los Angeles.