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  1. #1
    Join Date
    Nov 2019
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    Oregon
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    Default Legality of Employee Discount Loophole

    My question involves criminal law for the state of: Oregon

    Alright, so I work at a large retail company and my employee discount is a blanket X% on most items. It is explicitly stated in the employee discount policy that we can use this X% discount to purchase gift cards for ourselves, friends, or family. Pretty good deal, huh? What I realized the other day though, is that you can use gift cards to pay for gift cards.

    Let's say this discount is 50% off. That would mean I could buy a $200 gift card for $100, and save $100. Again, this is a completely legit use of the employee discount. However, I could also buy a $100 gift card for $50, and then use that $100 gift card to pay for the $200 card. In this case, I'd be saving $150 instead of $100. At a certain point, the difference between gift card amount increments becomes smaller than the difference between the cost of the gift cards with the discount, and I can pretty much get an infinite amount of multi-hundred-dollar gift cards for just a few bucks.

    I've tried this with a small amount already and it worked, my item shipped. It's been about two weeks and no contact from HR or any sign that the company has noticed. This is all automated through their website, and the website allows me to do everything above. Clearly this is a loophole in the discount policy, and there aren't any oversights in their website to prevent employees from exploiting the loophole. I'm aware that if the company notices, I will most likely be fired. However, would the company have any grounds to take legal action against me for exploiting the loophole? It's highly unethical, but doesn't go against the discount policy and I'm not technically deceiving anyone to make a profit.

    Thanks for your help!

  2. #2
    Join Date
    Sep 2018
    Location
    Ohio
    Posts
    243

    Default Re: Legality of Employee Discount Loophole

    Quote Quoting Inebriatedcactus
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    What I realized the other day though, is that you can use gift cards to pay for gift cards.
    And who quoted that windfall to you? Some other employee with no authority who did it too, or upper management?

    You mean to say if a TV is retailed at $1,000.00, you can buy it for $500.00?

  3. #3
    Join Date
    Nov 2019
    Location
    Oregon
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    5

    Default Re: Legality of Employee Discount Loophole

    Quote Quoting RJR
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    And who quoted that windfall to you? Some other employee with no authority who did it too, or upper management?

    You mean to say if a TV is retailed at $1,000.00, you can buy it for $500.00?
    I randomly thought of it one day, and tried it later that afternoon with a small amount. By "can" I meant it's possible to do with the website, you basically just put in a previously purchased gift card as a payment method when purchasing a new, larger gift card with the X% discount. There isn't anything in the employee discount policy that states we cannot use gift cards as a payment method to purchase additional gift cards.

    And yeah, I could theoretically buy a $1,000 TV for $20.

  4. #4
    Join Date
    Sep 2018
    Location
    Ohio
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    Default Re: Legality of Employee Discount Loophole

    When you buy a gift card does it have to be activated at the register?

  5. #5
    Join Date
    Nov 2019
    Location
    Oregon
    Posts
    5

    Default Re: Legality of Employee Discount Loophole

    Quote Quoting RJR
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    When you buy a gift card does it have to be activated at the register?
    No, the whole thing is done online - both the ordering and use of the gift cards. Would it be a legitimate defense to say that the website allows it and there is no statement against using gift cards to buy gift cards in the employee discount policy?

  6. #6
    Join Date
    Sep 2018
    Location
    Ohio
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    Default Re: Legality of Employee Discount Loophole

    Are the cards in question your companies cards or say gift card Visa's etc.

  7. #7
    Join Date
    Oct 2006
    Posts
    15,726

    Default Re: Legality of Employee Discount Loophole

    Quote Quoting Inebriatedcactus
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    No, the whole thing is done online - both the ordering and use of the gift cards. Would it be a legitimate defense to say that the website allows it and there is no statement against using gift cards to buy gift cards in the employee discount policy?
    I suspect that if you did it enough to end up with a 1k TV for 20.00 that the company would catch on, close the loophole and probably fire you. I am actually surprised that you can buy gift cards at all using the employee discount.

  8. #8
    Join Date
    Nov 2019
    Location
    Oregon
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    Default Re: Legality of Employee Discount Loophole

    They're the company's gift cards - they get emailed to me with a card number and PIN

    Quote Quoting llworking
    View Post
    I suspect that if you did it enough to end up with a 1k TV for 20.00 that the company would catch on, close the loophole and probably fire you. I am actually surprised that you can buy gift cards at all using the employee discount.
    Yeah, that's what I figured. Would they have any grounds to take legal action against me in addition to firing me?

  9. #9
    Join Date
    Oct 2006
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    15,726

    Default Re: Legality of Employee Discount Loophole

    Quote Quoting Inebriatedcactus
    View Post
    They're the company's gift cards - they get emailed to me with a card number and PIN



    Yeah, that's what I figured. Would they have any grounds to take legal action against me in addition to firing me?
    I don't know. My guess is that no, they wouldn't try to take legal action because it wasn't against the rules, but you would really have to read the fine print of the rules to be absolutely certain that it wasn't somehow addressed.

    However, I do know someone's teenage child who got arrested for giving discounts at Sears even though the system allowed her to give the discounts, so there is no guarantee.

  10. #10
    Join Date
    Sep 2018
    Location
    Ohio
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    243

    Default Re: Legality of Employee Discount Loophole

    Quote Quoting Inebriatedcactus
    View Post
    Yeah, that's what I figured. Would they have any grounds to take legal action against me in addition to firing me?
    Criminally it would probably be based on some type of fraud, if pursued. Civilly, they may sue you to recover any $ amounts. What you are claiming to do is, among other possible torts, is "Unjust enrichment".

    The 64 million $ dry cleaning pants lawsuit shows how anyone avenue of enrichment can be proffered.

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