Retailers are facing a surge in shoplifting and potential rising costs of claims in light of civil unrest. In March, police forces in England, Wales and Northern Ireland recorded nearly 33,000 incidents of shoplifting, according to data analysed by the BBC. This represents an increase of more than 30% compared with March last year. Meanwhile, the Financial Times recently reported on how social media can leave retail chains vulnerable to multiple losses from one civil unrest event.
If your security team detects someone who intends to steal or otherwise cause unrest on your retail premises, then detaining the suspect could be part of your response. This may be particularly true now, when threats to your revenue intensify in light of economic uncertainty and pockets of activism or social media trends leading to unrest. But there are risks and rewards to any approach you take on detention.
Getting the balance right can mean lower shrinkage (lower stock than registered, that is, stolen stock), creating shopping experiences more likely to feel secure and inviting, and reducing legal liabilities and reputational damage whilst containing insurance costs. Not getting the balance right can leave your business exposed to a range of reputational risk and liabilities, whilst simultaneously absorbing the costs of security guards and loss of stock.
To support retailers in better protecting their stock, people, customers and the longer-term profitability of the business, this insight examines:
If you employ either private or contracted commercial security personnel in the U.K., then you’ll be subject to the Criminal Law Act 1967 and Police and Criminal Evidence Act 1984, both of which provide legislation regarding the measures individuals can carry out during a citizen's arrest. This is the only type of detention power available to security guards and is the same detention power available to any ordinary citizen.
The relevant laws (set out in Section 24A of the Police and Criminal Evidence Act 1984, Section 3 of the Criminal Law Act in summary mean):
Having a known policy on routinely detaining shoplifters can help reduce shrinkage and therefore protect revenues by making your retail locations less of a ‘soft target’ to potential shoplifters (who can expect a higher likelihood of being caught, being held accountable and prosecuted at your retailer than at stores with fewer visible and/or less responsive security personnel) .
But having security guards routinely ready to detain suspected thieves can also raise risks and potential insurance costs in a variety of ways, particularly where the suspected shoplifters sustain serious injuries or if an incident leads to a fatality. Recent high profile incidents have included a retail security guard being found guilty of manslaughter, while there have been multiple incidents of videos emerging on social media of security guards using what’s seen to be excessive force. There have also been reported instances where security personnel have failed to conduct detentions to the correct standards.
These scenarios have both the potential to lead to significant damage to corporate reputation and increase the possibility of legal charges being brought against the company. In fact, your approach to detaining shoplifters can have an impact on the cost of cover across multiples lines, including public liability, employers’ liability, personal injury, and business interruption.
On the personal injury front, claims could relate to suspected shoplifters reporting security staff harmed them by using excessive force, or security staff themselves claiming physical or mental harm as a result of being involved in detaining suspects.
Your brand could also face significant reputational harm if security staff are seen to have poorly judged what represents the person’s rights or the use of ‘reasonable force’ and caused significant harm to, for example, a vulnerable individual caught stealing stock.
In terms of business interruption, you could face longer periods of interruption should your retail locations become subject to protest or become a crime scenes, which could impact premiums into the future. And, if you experience a loss, without robust processes and controls around store security, including your approach to detention and how you manage the associated risks, your insurance claim could be refused.
The risk/reward trade off on detaining shoplifters will vary from retailer to retailer. At the higher end of retail, low numbers of higher value items could significantly dent revenues, so your stance may be more proactive. This might compare with, for example, budget supermarkets where the risks of detaining individuals suspected of stealing low value items might not outweigh the risks.
Thorough training on retail detention best practice, applying the widely-recognised ASCONE protocol (Approach, Selection, Concealment, Observation, Non-Payment and Exit steps when profiling a suspect and that must occur before staff decide to detain the suspects) and SAFER (Step back, Assess, Find help, Evaluate and Respond protocols around detention procedures) can reduce some of the risks, whatever your stance on detention.
Technology can also play an important role in acting as a deterrent and boosting potential claims defensibility. This includes body cams, forensic spray (that tags shoplifters and makes it easier for police to identify criminals at a later stage), metal detectors, alert buttons, effective CCTV, and AI-enabled technology that alerts security guards to potential theft.
Having a clear detention framework and protocols can be a core part of protecting your business, particularly where you can achieve organisational consensus between security, legal, operations and communications teams on the most appropriate approach for your brand.
Where you are relying on third-party security guards, enforcing contractual audits and key performance indicators (KPIs) relating to training and on-boarding can ensure standards are maintained when outsourcing, helping reduce the potential risks to your people, customers and brand.
The ultimate question as a risk manager you should pose is: does your organisation’s policy on the detention outweigh the risks, or can you be more selective about the triggers for detention and instead invest in technological means of preventing shoplifting in the first place?
Claims analytics can bring clarity, revealing anomalies or patterns that may suggest your loss prevention policy should move on from ‘hands-off’ approach to detaining shoplifters, or pivot from a stance where security guards are required to routinely suspects.
For specialist support to find smarter ways to manage risks around dealing with theft, get in touch.
