6-21.

what would be the advantages and disadvantages to Jennifer's company of

routinely administering honesty tests to all its employees?

Carter Cleaning Continuing Case Chapter 6

1.The disadvantages of administering tests to its employees is the

cost associated with them and the legal factors that surround them.

*If they ask the wrong question they could be faced with a law suit
that would hurt the company’s image.

*The advantages of administering tests is that they have shown to

reveal positive results for the employer.

*They tend to be reliable and dependable results so they may be

worth the cost if they can stay within the legal aspects.

2. Jennifer should check to see if her company can afford

background checks and see if the savings they receive from less
employee theft will outweigh the expense.

*If they do background checks, I also think that the employee

turnover rate would decrease as a result of better candidates filling
positions.

*They could also try “scaring” the job applicants by emphasizing

that theft will be punished with a ride in a cop car or something to
that effect.

*It seems to work on shop lifters.

3.She should call the police as soon as she has proof that the
employee engaged in theft.

*Police reports and court documents are public documents that will
warn future employers of the individuals’ actions.

* It will also set an example to the other employees of the

consequences they face if they engage in the theft.
Honesting testing at carter cleaning company.

Questions and Answers.

1.What would be the advantages and disadvantages to Jennifer’s

company of routinely administering honest tests to all its
employees?

Polygraph testing raises a large number of legal and moral issues;

issues Carter Cleaning must avoid. Using some of the available
“paper and pencil” honesty tests may be a possibility. In general,
these have been shown to be reasonably reliable and valid. They
are still controversial. The costs associated with these tests may
also make them prohibitive to a small operation like Jennifers carter
cleaning.

2.Specifically, what other screening techniques could the company

use to screen out theft-prone employees? How exactly could these
techniques be used?

More thorough background checks are a recommend technique to

eliminate thieves. Some firms chose to contract this out to a private
security agency (Costmay be an issue to Jennifer. However, the
company can quickly check to see if savingsfrom reduced theft
would offset the cost of an outside agency. As part of the job
preview,Carter must communicate that jobs in her company are
worth keeping; dishonesty and theft will not be tolerated. Further
company policies regarding theft should be clearly communicated to
new and existing employees.

3.How should her company terminate employees caught stealing

and what kind of procedure should be set up for handling reference
calls about these employees when they go to other companies
looking for jobs?

Terminating employees for theft should include the involvement of

proper authorities and should only be done when there is absolute
proof of the theft and who committed it.Such an action will also
send a message to the other employees that you will not tolerate
theft of company resources . While many employers are reluctant to
prosecute employees for theft , developing evidence with police and
through the courts can be beneficial in providing future employers of
the individual with truthful and factual information.

THE BETTER INTERVIEW

Questions and Answers

1.In general, what can Jen do to improve her employee interviewing

practices ?Should she develop interview forms that list questions for
management and non-management jobs, and if so what form
should these take and what questionsshould be included? Should
she initiate a computer-based interview approach,and if so why and
specifically, how?

The company has an inadequate, unstructured way of interviewing

and hiring..One solution students could suggest is to utilize a
structured interview guide as a toolthat managers could use to
improve their interviewing practices. Have students brainstorm a list
of questions to be included in the structured interview guide.
Acomputer-based approach is also a possibility, students should
explore the pros andcons of this given the nature of the
organization and weigh the cost/benefit of utilizationof this
technology.

2.If she implements a training program for her managers, and if so,
specifically what should be the content of such an interview training
program? In otherwords, if she did decide to start training her
management people to be better interviewers, what should she tell
them and how should she tell it to them?

The answer to this question is yes, a training program should be

designed and delivered. Designing and conducting interview
effective interviews, including training in preparation, utilization of a
structured interview process, and interviewing techniques should be
put to use..She should educate managers in the potential pitfalls
that come up in the interviewing process , and provide opportunity
for practice with mock interviews in the training session so that
managers get an opportunity to use the skills they learn and
become comfortable with the process.
Advantages

Using Paper-and-Pencil Honesty Test would be a positive management

procedure.

Administering a Honesty Test can reduce many of Carters cost, the test will
identifying individuals for hiring, promotion or training who possess the needed
skills and abilities.

Jenifer or he father can administer a paper and pencil or use a computerized

method.

An Honesty Test does not require skilled administrators.

The use of a “paper and pencil” honesty tests have been shown to be reasonably
reliable and valid.

Honesty Tests are necessary to can hinder employee theft.

Honesty Test focuses heavily on behavior and characteristics assessment.

Most test takers don’t mind taking Honesty Test, they are well accepted.

Unlike other assessment test, Honesty Test results differ by gender instead of
race like other test types. Most view it as training.

Disadvantages

Honesty Test are controversial.

The costs associated with these tests may also make them prohibitive to a small
operation like Jennifer’s.

The cost of not giving Honesty Test is stolen equipment, service and supplies.

Honesty Tests can be fooled, as they are not an exact science.

Honesty Tests don’t show if a person is going to steal or not.

Sometime the test taker can respond in a way to create a positive decision
outcome rather than revealing their really personality. (i.e., they may try to
positively manage their impression or even fake their response).
6-22. specifically, what other screening techniques could the company use to
screen out theft-prone and turnover-prone employees, and how exactly could
these be used?
6-23. how should Jennifer's company terminate employees caught stealing, and
what kind of procedure should be set up for handling reference calls about these
employees when they go to other companies looking for jobs?

A 2016 University of Florida Study found that the percentage of shrink caused
by employee theft was “only” 30 percent.

This accounts for approximately $15 billion in losses on an annual basis.

Catching an employee stealing would seem an unassailable reason for
termination. But many individuals, even guilty ones, feel compelled to try to
clear their name through litigation.

If you or your managers were to make innocent mistakes during what should be
a legitimate termination, you could find yourself facing a lawsuit. Worse, you
could learn that your mistakes gave the lawsuit legs because it opened you up to
exposure to an individual who stole from your company.

The Investigation

In virtually every employment lawsuit arising from a termination for

wrongdoing, the first step of the termination process — the investigation —
becomes the most critical when scrutinized by a jury. An allegation of theft is a
powerful accusation and so an employee’s first tack in a trial to prove innocence
will be to show the investigation and its results are untrustworthy.

The Appropriate People Should Conduct the Investigation

First, at least two individuals should be involved in your investigation and,
optimally, one should not be personally acquainted with the subject. This will
help avoid claims that the allegation was trumped-up against an employee by a
hostile or biased investigator. For example, an employee being able to claim
that they were framed for theft by a manager for refusing earlier sexual
advances will create doubt as to fairness.

Make Sure the Accused Tells Their Side

You must allow any employee being investigated to tell their story and include
the account in your record of the investigation. Otherwise, a jury may think the
employee was railroaded. The investigation must be thorough, and your
investigator should never limit questioning to the witnesses identified by the
accused when there may be other individuals with relevant knowledge.

Follow Your Own Internal Policies

If your company has a protocol for investigations, it must be followed to the

letter. Juries demand that employers follow written procedures. Failure to do so
can serve as evidence of “pretext” (a justification for a course of action that is
found to be false) and could defeat your efforts at winning the case on written
motions, rather than going all the way to trial.

Make Sure Your Witnesses Provide Their Own Testimony

It is important for witnesses to write their statements in their own handwriting

and using their own words. Nothing tanks the credibility of a witness faster than
when they don’t understand the meaning of words used in “their” written
statement when testifying on the stand.

Preserve Records and Recordings

Another concern arises when a company acts as if it will never hear from the
employee again once they depart the workplace following a termination. Even if
you obtain a written confession of theft, it will be no substitute for a complete
investigative file. Your investigator must organize and store all the records of
the investigation for future use. Nothing should be destroyed.

If you plan to use business records or recordings that are ordinarily destroyed in
accordance with your company’s record retention and destruction protocol, they
should be moved from their usual location and preserved. Just as video footage
of an employee pocketing a twenty is solid gold in a court, not having that video
footage is solid gold for the plaintiff in an employment trial. If the video is
missing, no explanation will overcome a jury’s assumption that you did not
want them to see the video for some nefarious reason. Likewise, if an
investigator reviews evidence, such as financial reports, stored on a computer,
they should create copies of these records to be included in the investigation
file.

Catching the Thief

The method used to catch thieves is another aspect that can result in liability.
For example:

It is common for retail managers to hide baby monitors or other electronic

listening devices in break rooms to try to catch employees talking about
stealing. While the idea seems perfectly logical, it could also be illegal under
federal anti-wiretapping laws and state privacy statutes.
During an investigatory meeting with an employee who is suspected of theft, if
you have the employee in a position where they cannot leave the room or area
without “going through” one of your managers, it could lead to a false
imprisonment claim.
Digging through an employee’s purse or other personal belongings looking for
stolen merchandise without consent to search could generate an invasion of
privacy claim.
Using a lie detector during an investigation of monetary loss could open you up
to legal claims given strict federal regulations on the subject.
Because of factors like these, it’s important that you take several steps while
attempting to catch an employee on suspicion they are stealing.

Destroy the Expectation of Privacy

Every employee should sign an acknowledgment that they understand they have
no privacy rights in regard to those items they choose to bring on the premises.
Employees should also acknowledge and consent in writing that they are under
video surveillance while in all public and employee-only spaces at your store
(not bathrooms or other private spaces). This will prevent them from bringing a
successful invasion of privacy claim in the future.

Set Expectations for Investigations

At the outset of any investigation into alleged theft, the accused employee
should be made aware that participating in company investigations is
mandatory. Provide them a written notice that refusal to cooperate may result in
termination.

Create and Enforce Policies Related to Company Assets

Finally, you should expressly advise all of your employees regarding your
policies pertaining to the protection of company assets. Instruct them that
violations of the policy may lead to their immediate termination without any
finding of intentional wrongdoing.

The Termination Meeting

The termination meeting should not be the first time the accused is informed
that they are suspected of malfeasance. Regardless of any benefit to keeping the
employee in the dark about your suspicion while you conduct a covert
investigation, and even if termination is essentially a foregone conclusion at the
time of your interview with the accused, you should still hold off on making a
termination decision and from communicating that sort of message during that
first interview. It is far better to suspend the employee pending the outcome of
the investigation. Many times the employee will not return for a follow-up
meeting and can be terminated as having abandoned their job. There are far
fewer facts to argue when an employee is terminated on these grounds.

Your Words Matter

How the termination meeting is to be conducted depends heavily on the strength

of your evidence. If all the signs point to theft but you don’t necessarily have
anything that is conclusive, you should not use terms like “theft,” “dishonesty,”
or even “suspicion of theft” as reasons the employee is being terminated. This
does not mean you cannot terminate the employee, but accusing an individual of
a crime is per se defamatory in many jurisdictions, and you may be required to
prove in court that the employee did, in fact, commit a crime. Instead, language
centering on your lack of trust in the employee—“we are terminating you
because we have lost confidence in your ability to perform your job up to our
expectations”—is much less likely to be considered defamatory.

Focus on Your Policies, Not the Criminal Code

Another way to couch your justification for termination if you are less than 100
percent certain of the employee’s guilt is to cite a violation of your company
policies and not any allegation of criminal wrongdoing. In this scenario, you
should tell the employee that you have not reached a conclusion as to their
culpability for a crime, but that the termination is because proper store
procedures were not followed.

Admissions of Guilt

If an employee admits to the theft, ask for a written confession. As with any
other witness statement relating to an investigation, this should be in the
employee’s own handwriting. Managers should also be taught that the “Law and
Order” hot-boxing method of extracting written confessions could easily
backfire. If the circumstances under which the employee gives the confession
can be characterized as coerced, a jury may choose to ignore it. To this end,
allow an employee to leave the interview and go to another area where the
investigators are not hovering around as the document is prepared.

If the employee refuses to admit theft even where there is indisputable evidence
of guilt, you must choose carefully how to characterize the termination.
Employees who refuse to admit guilt in the face of overwhelming evidence will
most likely continue to fight the assertion of theft at every opportunity. These
are the individuals most likely to sue.

Once you submit “theft” as the reason for termination to an unemployment

compensation board, the battle will be on. It may well be a battle worth fighting,
but that decision must be made in light of all the potential claims an employee
may have against you, not just the unemployment compensation claims. These
include discrimination allegations, wrongful termination claims, and defamation
suits.

Police Involvement

Before calling the police, it is critical to know how seriously they will respond
to allegations of theft of a few hundred dollars in merchandise. Some police
departments are simply too overwhelmed to do more than write a report of the
complaint. Either a lack of interest or sloppy handling of the matter by the
police can both be used to undercut your claims against the employee.
Ultimately, no police involvement is better than limited or poorly handled
police involvement.

If a police department is ready, willing and able to respond to reports of theft,

call them when the missing item or money is discovered. In such a situation, it
is critical that whoever interfaces with the police does not point the finger at the
suspected employee. If a different employee turns out to be involved, your
initial finger-pointing might spur a claim for malicious prosecution under state
law. Should the suspect beat the charges, which sometimes occurs, the
employee will be more likely to succeed on a claim for malicious prosecution
against you.

If the police move forward with charges against the employee, you must be
willing to provide all the assistance they require. Witnesses failing to appear for
trial will result in charges being dropped and will cast doubt on your good faith.

The Unemployment Compensation Hearing

Treating the almost inevitable unemployment compensation claim lightly can

wreak havoc on later proceedings related to the termination. If the employee
already has counsel, that attorney will likely attend the hearing and question
witnesses. Testimony is under oath and, in some cases, can be used against you
in later proceedings. For these reasons, it is important to prepare for an
unemployment hearing as if it were a formal court proceeding.

Another problem can arise if key witnesses are no longer employed by the time
of the hearing. While they can be subpoenaed, many employers fail to take this
step, hoping that the written statements taken during the investigation will carry
the day. The problem is that, while the statements are often admissible, the court
or administrative body might not be able to credit hearsay statements over the
first-hand accounts of the employee.

The employee often becomes emboldened to assert other claims when they
prevail in an unemployment compensation claim. Additionally, an employer
that loses at the unemployment hearing might also lose the qualified privilege
defense to a defamation claim for statements accusing the employee of
malfeasance. If you do not want to spend the time, energy, and effort needed to
fully prepare for the unemployment compensation claim, it may well be better
not contesting the claim at all.

While retailers can take strong efforts to reduce employee theft, eliminating it
entirely is likely impossible. But employers have the ability to greatly diminish
the opportunity for the insult of an expensive lawsuit being added to the injury
of theft.