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Amid labor shortage, restaurant hire and retain staff for the recovery

Restaurateurs get creative in the moment, but think long-term beyond COVID

After laying off and furloughing many restaurant team members as a result of the COVID-19 pandemic, many restaurant operators now find themselves in an odd position: they can’t find enough employees to meet the pent-up demand for on-premises dining and continued takeout business. Countless news announcements, press releases and classifieds attest to the shortage of labor across the country and paint a picture of an understaffed industry.

In response to this staffing crisis, restaurant company executives are raising wages, enhancing benefits and attempting to address the needs and wants of employees so they can not just recruit them, but retain them.

Amid a lengthy period of reflection about the treatment of people of color, restaurant companies are also taking steps to diversify their staff, executive ranks and boards, and bolster diversity & inclusion departments.

Darden Restaurants announced in March that it would pay a one-time bonus to employees totaling $17M. In addition, it began a graduated raise to the blended rate of pay for tipped and non-tipped associates. A minimum wage at the Orlando, Fla.-based restaurant company of $10 per hour (inclusive of tip where applicable) has already gone into effect. In 2022, that rate will increase to $11, and in 2023, to $12.

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Also in March, Whataburger paid out $90M in bonuses to employees as a thank you for their hard work during the pandemic. In appreciation for their leadership, general managers received the new title of “operating partner,” and the quick-service chain also committed to maintaining a culture that includes a work-life balance. Operating partners now have a clear path to making six figures and can earn bonuses equal to 150% of target incentives.

Taco Bell also announced enhanced benefits for managers, as it pushed to hire 5,000 team members and launched Hiring Parties. General managers will now be able to accrue four weeks of vacation per year. At Taco Bell company locations, general managers also receive four weeks of paid “baby bonding” time for new parents and guardians, as well as eight weeks of fully-paid short-term disability after the birth of a child.

At Rusty Buckets Restaurants & Taverns, executives are providing signing bonuses and zoom interviews to engage potential candidates, notes Kristen Hinshaw, director of human resources and operating partner.

“We are now facing a challenge that we’ve never seen of this magnitude: we simply are struggling to find people to work,” she said. “We’ve always offered flexible schedules and great benefits, but we have had to get creative with our hiring practices.”

Creating a safe environment

Improved compensation isn’t the sole requirement to lure employees back. Currently, many are hesitant to work in a perceived higher-risk environment, while other former restaurant employees have transitioned to other job sectors. Safety continues to be a pressing factor for those working inside restaurants.

“Your first priority should be to ensure the safety of all employees,” says Rick Camac, dean of Restaurant & Hospitality Management at the Institute of Culinary Education. “Employees want to know you’ve taken all precautions to make the environment safe for them. This can include having proper sanitizing stations, HEPA filters, temperature monitoring devices, contact tracing and properly spaced out tables or screens installed to separate diners.”

During the COVID-19 crisis, quality of life has intersected with safety, suggests Hinshaw. She says Rusty Buckets staff have been appreciative of their employer’s stance on wellness and the protective measures the 22-unit chain has put in place. They have also implemented schedule adjustments so managers can be at home a few more days per month. Hinshaw adds, “Quality of life was a challenge we were focused on prior to COVID-19, and the pandemic certainly boosted that effort into overdrive. Our main concern has been the health, safety and well-being of our associates and managers. Providing the safest work environment possible in these times is providing quality of life.”

Mary Hamill, vice president, Sales Solutions at Fourth, a provider of supply chain, human resource outsourcing and workforce management solutions, agrees that restaurant employees are looking for safety, and that operators should ensure staff are comfortable as they perform their duties in the restaurant environment. “This means maintaining extra sanitation stations and practices, as well as continuing to practice social distancing and daily health check ins—which are made easy through Fourth’s in-app health survey, a tool that prevents potentially sick employees from coming in to work and exposing other team members,” added Hamill.

Supporting personal development

Large restaurant companies are offering personal development benefits as a way to attract and retain employees. Employees may appreciate the possibility of advancing through the ranks, but many understand that education will make them even more competitive, particularly as they venture into other sectors and corporate positions. Chipotle Mexican Grill has been augmenting this part of its benefits package under its Cultivate Education program. In 2020, the fast-casual chain paid out $13M in tuition costs for eligible employees.

Chipotle paid $13M in tuition costs for employees in 2020. Photo by Chipotle.

This year, it added free degree programs in Agriculture, Culinary and Hospitality, and expanded the list of accredited partner universities in which employees can pursue such degrees. Chipotle has also added new elements to its Supply Chain Education program. A total of 85% of those enrolled in the Cultivate Education programs are crew members.

“We’ve seen a retention rate that is 3.5 times higher among employees enrolled in the program, and crew members participating are 7.5 times more likely to move into a management role within the organization,” said Brian Niccol, Chipotle chief executive, when discussing education assistance benefits during a Q3 2020 earnings call with analysts.

Tackling diversity and inclusion

Over the years, the restaurant industry has certainly been a launching pad for people of all races and origins to make a living and pursue their dreams. Heightened awareness of minority underrepresentation in restaurant C-suite ranks, boards and management teams has led to a call for change. Restaurants have responded by allocating increased funds to diversity & inclusion initiatives and beefing up departments that support such work. Starbucks, for example, included diversity goals tied to executive compensation last fall and set up a goal of having 30% Black, Indigenous and People of Color inclusion in its corporate ranks and 40% at its retail outlets.

In August, Bloomin’ Brands promoted Sheila Henry to group vice president, Diversity & Inclusion, reinforcing equity initiatives across the restaurant company’s brands. And earlier this year, Wendy’s hired Beverly Stallings-Johnson as chief diversity officer. Her role began in March, and she will help provide momentum to Wendy’s diversity goals within the employee, franchisee and supplier stakeholder communities.

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Evolving perspectives

A Johnson & Wales University (JWU) virtual symposium gathered some great minds in the culinary world in March. The perspectives of several chef alumni pointed to a brave new world in which labor shortages would be a reality and culinary graduates would have greater opportunity to pinpoint their careers and not burn out.

Champe Speidel, chef/proprietor of Persimmon restaurant and James Beard Award Semi-Finalist for six years in a row, said that he’s come to the realization that restaurants need to pay people what they are worth and that they can’t work chefs and cooks 16 hours per day.

As a recommendation to JWU students, Chef Aarón Sánchez, chef, TV personality and James Beard Award winner, said, “You can go into so many different areas. Don’t feel the pressure of being a restaurant chef. You can do so many things.” The pandemic has recast priorities and perspectives, and it’s possible that foodservice leaders and restaurant operators will also change business practices to invite and encourage new candidates to thrive inside their restaurants.

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With greater attention to quality of life and a renewed respect for employees, restaurant operators are embarking on their most aggressive push to hire back and build back their industry. Their enhanced focus on pay and benefits, creative recruitment, employee development through tuition reimbursement, and of course, expanded worker safety form a blueprint for how they’ll both attract and retain workers for the recovery.

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