Stealing Is Contagious

October 7, 2019

The restaurant industry, like many cash industries, is ripe for theft. One thing to take note of is just how contagious bad behaviors like stealing tend to be inside food establishments.

New research by three researchers from Olin Business School at Washington University in St. Louis have completed a study of workplace theft among restaurant workers that details, for the first time, how stealing is contagious. New restaurant workers are particularly susceptible.

While thieves tend to influence other workers to steal, the research team found that peers are strategic about when to use their sticky fingers: If Bob is stealing a lot today, they’ll say, we’d better not steal — or everyone will get caught.

To reach their conclusions, researchers studied seven years’ worth of data from a restaurant point-of-sale equipment distributor, covering 1,049 locations from 34 different casual dining restaurant chains in 46 states. The database included more than 5.7 million transactions involving more than 83,000 servers.

The team's research found that fully 56% of servers in the database committed identifiable theft at least once.

The researchers used the data to gauge whether misconduct among workers spreads to coworkers. Their paper, “The Influence of Peers in Worker Misconduct: Evidence from Restaurant Theft,” is forthcoming in the journal Manufacturing & Service Operations Management.

“Bad apples with high levels of misconduct are even more costly than their individual behavior,” the authors wrote, because those bad apples negatively influence their peers to commit similar bad acts.

The problem is even bigger than the data shows, said Tat Chan, professor of marketing at Olin. Chan and his colleagues studied data looking at millions of restaurant transactions, but the algorithm it used took a conservative approach to flagging theft.

One key finding: If new restaurant workers are exposed to stealing peers within the first five months of starting their job, they also are likely to become habitual thieves.

“To make sure employees do not learn stealing from their peers, it’s important to influence them in the first few months,” Chan said. “If they don’t know what the typical conduct is, but they see their peers steal, they will follow.”

Several schemes in the industry are notorious, including “the wagon wheel scam,” in which servers transfer an item from one customer’s bill to another who ordered the same thing. Once the first customer pays the original bill, the server reprints it without the item and pockets the difference.

Other schemes involve “comping” or refunding a meal — or voiding a transaction entirely — after the customer has paid, but before the ticket is closed.

The National Restaurant Association estimates that theft accounts for 4% of restaurant costs. The U.S. restaurant market is projected to earn about $863 billion this year.

The team’s research found that fully 56% of servers in the database committed identifiable theft at least once. The good news: managerial oversight does reduce theft.

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Insurance Journal West October 7, 2019
October 7, 2019
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