I witnessed a moral hazard when a coworker did a risky sales move with a client that was not sure if he wants it to do it and in the end, he did an unethical move so he can earn more money off that sale. Last year a week prior to the COVID-19 pandemic lockdown my colleague and I were working in the same area and we had the idea to work together so we can achieve the office sale of the week and make a good profit. One of the incentives in achieving the sales of the week was based on what kind of sales you did a high-end sale or a low-end sale. For the high-end, besides the commission of the sale, you gain an extra $150 bonus and if you did the low-end you receive a $50 bonus only, so for us was a really important bonus and raise our morale and motivation on doing the sales as soon as possible. So, my colleague doing his sale made an unethical risk in lying to the customer by giving wrong the promotion just for getting the extra bonus. After he succeed in his sale and after that night we got promoted in our office. Days passed and the client called our office and reported the unethical move and I have to give a report about that fact. Because of that the person who was fired moved and got on probation because management blame me for not reporting the incident at the time. By those acts, the firm made the decision on cutting our bonuses until next time. The rest of the colleagues got disappointed about that decision but was something good for the future of the office.

What can the owner do to minimize such risk?