[outworlder]

Nope, we should not just arrest them. However, they should all be punished in some way.

'prison' and 'punishment' aren't synonyms. Make someone work their ass off to repay a crime IS punishment. As is locking them up, but by doing that, you severely decrease the chances of that person ever being a productive member of the society again.

Of course, should that person break the terms agreed upon, then I guess prison time is warranted as an additional punishment. And even in this case, with non violent criminals, in a setting where they can still work.