It’s 8:00, Monday morning. Normally your day off, but you received a phone call Sunday evening at home that was disturbing and you decided to come in and check it out. The phone call was from a veteran employee who said that he had been invited to a party over the weekend where some other employees had gathered. It turns out that the party was on you because one of the employees had pilfered a couple of cases of beer from the walk-in cooler at your restaurant.
To add fuel to your raging fire, it turns out that the employee was a minor and that several minors were at the party consuming the beer. Fortunately, as far as you know, no one was injured as a result of the drinking. What do you do now?
The scenario described above occurs all too frequently where alcohol is sold and minors are employed. It is a dangerous mix. Particularly when the legal serving age is lower than the legal consumption age, which enables minors to constantly be around alcohol and around people that consume it. You are fortunate that your wake-up call did not include the report of a severe injury or fatal accident and now you have the opportunity to be proactive.
Due to the rise in dram shop (or third party) litigation for the responsible service of alcoholic beverages to guests, most restaurant managers have been vigilant in having their employees trained to serve alcohol responsibly. In most of these server-training courses there is a section on dealing with minors. However, rarely does that information discuss practical techniques for preventing employees that are minors from consuming alcohol while working and/or removing it from the premises for consumption at a later time.
The question that needs to be answered is, “Does a restaurant manager have an obligation to safeguard alcoholic beverage inventory (not only for short term profit concerns but also from a safety and liability standpoint)?”
The answer is clearly YES.
Safeguarding all inventory is a high priority with restaurants today. However, given the liability that can arise from the over-consumption of alcoholic beverages, special concern and steps need to be taken to secure it. Accordingly, within your responsible service of alcohol policy you must develop safeguards to prevent the theft of your alcoholic beverage inventory.
STEP BY STEP
First, establish a complete physical inventory practice and cost percentage analysis. An accurate cost percentage analysis when compared to the projected cost for a regular interval is an excellent barometer for managers. If the alcoholic beverage cost is analyzed on a regular basis and the cost percentage continues to rise over time, a very likely explanation, although not the only one, is internal theft.
Management should be solely responsible for the ordering, receiving, issuing and storage of alcoholic beverages.
Next, make sure all liquor, beer and wine is stored in a secured area. The inventory of alcoholic beverages should only be accessible by management.
Management should be solely responsible for the ordering, receiving, issuing and storage of alcoholic beverages.
Only management should participate in the physical inventory of the alcoholic beverages stored at the restaurant (including stock kept at point-of-sale outlets).
Random inventories of alcoholic beverages should be performed by a member of management that is not ordinarily charged with the task. An unscrupulous manager that is continuously involved in the inventory process can overstate the amount of alcoholic beverage inventory on hand at the end of every regular inventory period. Then the restaurant’s alcoholic beverage cost percentages will be inaccurate and will make a detection of theft, utilizing a standard cost analysis procedure, nearly impossible. Insure that strict inventories are established and accounted for when temporary distribution points are set up in banquet rooms or outside. Pay particular attention to beverage carts that are used to sell items throughout the course.
Finally, remember that there are not any perfect security systems. Therefore, even though you believe that all of your alcoholic beverages are safe and secure, continue to be proactive in your surveillance by employing random audits/inventories and most importantly, continually check the trashcans and around the dumpsters. One of the most common methods for employees to remove inventory from a restaurant is to remove it from the premises in a trash can and then either dump it in the garbage dumpster or set the items next to the dumpster so that they can pick them up when their shift ends or so an accomplice can come by and retrieve the items.
(The foregoing steps are primary methods to prevent theft of bulk alcoholic beverages. For a more detailed discussion of preventing internal theft both in the inventory area as well as at point-of-sale areas see the book, “Preventing Internal Theft: A Bar Owners Guide,” by Robert Plotkin.)
SAFETY FIRST
It is now 11:00 AM and you have just finished establishing new rules and procedures for securing your alcoholic beverages as well as establishing new inventory guidelines and analyzing prior inventories. In order to further investigate the circumstances, you contact the minor that allegedly took the beer.
During the conversation, the minor, as a justification for his or her actions, tells you that it is common practice for minor employees to consume alcoholic beverages on the job and the employee assumed that since it was so commonplace that a couple of cases of beer for an employee get-together was no big deal. What do you do now?
A sample form (below) of responsible alcohol policies.
Alcoholic Beverage Acknowledgement Form
I have read and understand the restaurant’s Responsible Service of Alcohol Policy dated __________. I acknowledge my responsibility to comply with the policy and to enforce it.
I specifically acknowledge that the consumption of alcoholic beverages on the restaurant’s premises by any employee is strictly prohibited. I also specifically acknowledge that the removal of alcoholic beverages from the restaurant’s property is strictly prohibited.
______________________________________
Employee’s Signature
__________________
Date
The concern now shifts from your responsibility to secure your inventory from theft to your responsibility to police the behavior of your employees while they are on the restaurant premises. The question is, “Does a restaurant manager have an obligation to prevent minor employees from consuming alcohol while they are on restaurant premises?”
The answer is clearly YES.
Accordingly, within your responsible service of alcohol policy you must clearly establish policies concerning the consumption of alcohol for your entire staff and specifically minors.
First, adopt a zero tolerance policy for the consumption of alcohol by all employees while on the restaurant’s property.
Then, make sure that the entire management team complies with the policy. The restaurant’s management must set an example for its employees, especially minors. You cannot establish a policy, then repeatedly violate it in front of your employees and expect them to take it seriously.
You must clearly establish policies concerning the consumption of alcohol for your entire staff and specifically minors.
Next, create strict closing procedures for the alcoholic beverage distribution areas of your restaurant. Routines established by managers (for example, going to the office to finalize paperwork) during closing times are prime windows for illicit consumption of alcoholic beverages by staff, particularly minors. Insure that all liquor, beer and wine is locked up, secured and inaccessible to staff. Assuming that you have taken the steps to secure your back-up inventory, you should be able to focus on your point-of-sale outlets during this time. If you are serving draft beer be sure to include a system that enables you to lock-off the taps.
Establish a “clear cup” policy for employee beverages. That makes it more difficult for employees to hide beer, wine, or straight liquor in a Styrofoam cup or shaded glass.
Consider utilizing mystery shoppers to provide feedback regarding the service of your operation and include in their report compliance efforts made by your employees with the responsible service of alcohol policies.
Finally, consider installing surveillance cameras that view the areas where alcoholic beverages are stored and/or dispensed. If you choose to do so, the best practice is to make your employees aware of the cameras, which will avoid privacy issues and also have the added benefit of demonstrating to your employees, and the general public if need be, the restaurants’ commitment to enforcing its policies.
It is a good practice to have certain policies and procedures specifically emphasized by the restaurant and acknowledged by the staff. A sample form is provided (at left). The forms only ensure awareness of the policies by the staff. Management must demonstrate the restaurant’s commitment to safety and security by enforcing them.
Copyright 2005 Stephen C. Barth P.C.; All Rights Reserved.
Stephen Barth is an attorney, the founder of HospitalityLawyer.com and a professor of law at Hilton College, University of Houston. For more information visit www. HospitalityLawyer.com., or contact him at 713 963-8800 or at SBarth@HospitalityLawyer.com.
