Restaurant Articles

How to Catch Employee Fraud at your Restaurant

By July 26, 2016 No Comments

Unfortunately, employees defraud their employers from time to time. How can you spot this behavior and what technologies can help? Quick service restaurants (QSRs) are particularly vulnerable to employee theft and fraud because of their very nature. It is challenging to spot small amounts of money or product loss in a retail setting where thousands of point-of-sale transactions happen each day. As a franchise owner or QSR manager, you simply don’t have time to audit every transaction.

Here are some of the most common ways that employees commit theft against QSRs and how to detect incidents faster, gather evidence and prevent thefts from happening in the future.


Undercharging is the most common form of fraud that QSR operators experience. An employee undercharges the right price of an item and pockets the difference. They might also ring the order under a promotional price or use employee discounts.

Solution: Be wary of very small transactions under one dollar, because they add up over time. By using a comprehensive video surveillance system with analytics that integrate into your point-of-sale system, you can automatically flag suspicious transactions, such as sales of a certain amount or transactions with multiple voids. Once a transaction has been flagged, managers can simply review the high-resolution footage and point-of-sale data to determine if anything anomalous has occurred. In the long term, this data can reveal the frequency of these types of events across all employees and locations and identify employees who may be committing theft on a regular basis.

No Sale Transactions

A no sale transaction happens when the point-of-sale system allows your employee to open the cash drawer without making a sale. There are legitimate reasons for this to occur but it is also an opportunity to undercharge and order or grab cash without  a sale record.

Solution: By linking the point-of-sale data to your comprehensive surveillance video, you can get a snapshot of the no-sale event automatically. By accessing the video, you can see instantly if an employee committed theft.

Giving Away Product for Free

It’s common among QSR employees making minimum wage to give away free food to friends and family, but point-of-sale data won’t reveal this source of loss.

Solution: Advanced video solutions not only give you a high-resolution picture of what is happening in your restaurant but can also reveal where everyone is at any given time. Heat mapping can reveal when a customer is detected in front of the counter for a certain amount of time but doesn’t make a transaction.

Blind Spots in your QSR

A “blind spot” is an area of the restaurant that isn’t monitored by your video surveillance. If an employee figures out where it is, they can take advantage of it to commit theft unsupervised.

Solution: As a general rule, managers and store owners should be aware of the coverage provided by video surveillance. It is also prudent to rearrange the camera angles periodically so that employees do not become aware of potential blind spots.

We hope you’ve been able to deter fraud at your restaurants before it happens. Tell us how you’ve made improvements to you prevention game in the comments!