Previous threads on the topic have left me wondering ... What Would YOU Do?

Let's say you have a guy working for you. Let's further say that the guy is a good, honest, hard-working employee who so far has had only minor incidents of forgetfulness or inattention: leaving a wrench on a fender or a greasegun on a tire. Stuff that's happened to us all. Then one day, he has a major brainfart and really screws up. Turned too tight and ran an implement up the tire, busted something, failed to catch a problem before it went boom, you name it. In other words, a screwup that costs big $.

What's your first response? And why?

Do you have a zero-tolerance policy for screwups or do you allow for human error and leave wiggle room?