In order to analyze the impact of behavioral technology on service employee performance, a field experiment was conducted in a major department store. Drawn from 16 randomly selected departments, the 82 retail clerk subjects had the same training, performance standards, and at least 6 months experience. Their performance behavior (defined as selling, stockwork, miscellaneous, idle time, and absence from the work station) was measured via direct observation on a random time sampling basis. Both experimental and control groups were informed of the specific standards against which they would be measured, but only the experimental group was told of and received the contingent reinforcement, which consisted of paid time off, equivalent cash, and a chance for a paid vacation. Results show that the experimental group had a significant improvement in performance behavior, and the control group's behavior remained the same. The implications of behavioral technology for improved employee performance and the use of observational measures in field research in organizational behavior are discussed.