The senior high school senior was so looking forward to her upcoming school dance. Her dress was exquisite, and her shoes and purse matched perfectly. She was saving funds from her job in the local fast food restaurant to pay for all she needed to create the event so unique. There were flowers to select, a limo for the woman's and her date and some friends, pictures, and a whole large amount of extras that would make the evening a long lasting memory. She had all the girl future earnings planned out for that next few weeks and earmarked for that special occasion. What she had not necessarily planned for was the particular inexplicable shortage of $20 on her behalf cash till at perform. The restaurant had a policy that all cash shortages must be paid back. "Oh no! " she thought. "I didn't steal hardly any money; what am I likely to do? I need every penny I earn to pay for the dance. "Mandatory Payback Policy When consulting with suppliers and restaurant owners, the conversation will generally turn to cash shortages. A few have boasted they simply didn't have cash shortages due to policy they put in place. The policy required cashiers to pay for back shortages in their own tills. They further stated which shortages may occur a few times, but after paying for your shortages, a cashier was infrequently short again. The shortages required absolutely no investigation, no investment of a manager's energy, no disciplinary action, and no complicated funds handling policies.Policy Repercussions So having investigated many, many cash shortages and also implemented effective cash control programs for retailers and restaurants, paying back cash shortages is not part of the equation unless of course a comprehensive investigation was conducted, the cashier admitted in order to cash thefts and restitution was area of the resolution. Docking pay or having an employee pay the employer for cash shortages could result in the employee making under minimum wage and endanger the employer of violating salary and hour laws.Unintended Consequences Making cashiers pay back shortages may also have an opposite impact of its intention. Suppose that the younger cashier is making preparations to go to the special dance, as in the situation above. She needs money on her gown, matching shoes, tickets, hair and make-up, and perhaps sharing the cost of a limo. It's all a great expense for your young lady, but she is cash strategy carefully and every money she earns is designated as she prepares for her special event. She is a great cashier and even much better employee. But, alas, her cash drawer arises short. She didn't steal any cash in the till. A mistake in keeping track of back change or mishandling currency was the problem. Perhaps there are some other possible explanations. Maybe there was a blunder by a manager removing excess cash from her check out. Maybe another cashier rang transactions on her register while she had been on break and mishandled the money - or stole it.According to the principles, our cashier has to cover back the shortage. She panics because she envisions her perfect evening will probably be ruined. She can't afford to cover back the shortage. Could she ask for permission to not pay back the lack? Sure. Could she ask you to definitely loan her the money? Yes. But, she is desperate. She decides to have the money back by techniques she knew other cashiers were doing. They had been calling fraudulent transactions and robbing money for longer as compared to she had worked there and never one manager ever questioned them regarding it. They had bragged usually about their "extra" funds. She had always been disgusted with their cavalier attitude about taking. She makes her decision. She would only take the amounts necessary to make her dance special, - and then pay it back.She rings fictitious worker meals, voids, refunds and price reductions and pockets the cash. She's stealing! It was so easy that she is constantly on the take money far going above the amounts she had intended to pay back. The manager can rapidly spot register shortages, but neglected the the rest of cash management. The thefts continue long past her dance as well as her cash drawer is never short - as well as she never pays that back. She crossed the series, and is now the thief. If caught she might be arrested.Cash Management This story is true, and has occurred at many stores and restaurants. A sound cash management program doesn't require cash shortages being reimbursed. The incidences of cash shortage ought to be recorded in the performance history of the cashier. Cash management programs should include investigations of significant cash variances and implementation of progressive disciplines for each incident that require re-training when needed. Acceptable tolerance levels needs to be established for each part of customer transactions such as voids, refunds, price reductions, and no sales. Performance in these areas ought to be monitored and disciplines proven for poor performance. Each time an exception occurs beyond your acceptable level of performance in handling cash transactions the discipline is stronger. For example, the first time a cashier is short a lot more than $3, a written warning is reviewed with all the cashier. The warning includes more substantial repercussions with subsequent violations that can lead to suspension and possibly termination. The concept is called progressive discipline. The warning puts the employee on observe that their performance is being monitored, that proper cash handling is important, and establishes documentation associated with poor performance. The idea is to alter behavior.Effective loss control programs contain these elements of cash management. They are fair as well as equitable, establish the "ground rules" regarding performance in cash managing, and provide accountability in order to those employees who might be stealing by manipulating purchases. Requiring the payback of cash shortages as the foundation of a cash management program will not adequately address poor performance in cash handling. It may even the bucks tills, but does little to address exploiting the lack of cash controls.