The tide on labor best practices for restaurateurs has turned drastically over the past five years, from increased compensation and boosted benefits to flexible scheduling and gamified training. A labor shortage sparked by the pandemic led many workers away from foodservice jobs, resulting in restaurant owners finding clever ways to recruit, retain, and engage team members out of necessity. Restaurant leaders quickly realized just how important human capital is to their operations and the cost of underinvesting in their people and company culture—which has ultimately benefited both employees and employers alike as the entire foodservice industry evolves into the future.
“When you first get into the restaurant industry and open your first restaurant, you think that your asset is your restaurant, right? That the space, the building, the kitchen, you think that’s the business,” says Brad Parker, CEO of Chicago-based Parker Hospitality, which encompasses The Hampton Social, Bassment, and Nisos, a modern Mediterranean restaurant.
“And as you grow, you really start learning … the spaces are the easy part; it’s the people that become the hard part,” he continues. “When you want to focus on human capital, it’s kind of a scary, risky thing for an entrepreneur or business owner, because it doesn’t see the return that physical capital does. Meaning, if I put $100,000 into my restaurant, I can physically see it looks nicer; it’s refreshed. New customers come and say, ‘Ooh, it’s pretty.’ You see that immediately. With human capital, you have to invest this money, and that takes a long time to pay off.”
If restaurateurs commit to investing in their people and culture, employees in turn will also commit to the company at a higher rate, and retention rates will increase, he notes. But that commitment can’t only be talk about core values and being a family, or employees will quickly call your bluff.
“Pay as much as you possibly can. It should never be a competition to see how little you can pay,” says Mike Herchuck, director of operations at American Social. The Florida-based brand recently trained in a manager who excelled in the role right off the bat, so Herchuck pulled them aside within their first 60 days on the job to tell them he felt they were underpaid, and the restaurant was giving them a pay bump. “It is okay to do a salary correction when it is warranted. Sticking to some predetermined timeline for raises will only cause an unnecessary and regrettable turnover,” Herchuck adds. “You’re either going to spend money on hiring ads or pay your people more; I’d rather give the money to the team than to a hiring website 100 times.”
At North Carolina-based Tupelo Honey Hospitality, 50 percent of general managers and 75 percent of its managers have been with the brand for more than six years, says COO Caroline Skinner, thanks to a slew of factors. Simplifying communication by cutting down on emails, directives, and noise helps restaurant leaders focus on the food and guest experience, while important information is distilled into one monthly message in a concise format.
“The pandemic taught us to constantly ask the question, is it necessary?” Skinner says. “Regularly evaluate the layers of complexity in your communication, process, or training, and eliminate unnecessary complexities.”
In the fall of 2020, Tupelo formed Project Aspire, a diversity and inclusion program designed to uplift BIPOC (Black, Indigenous, and people of color) and female members of the management team. Aspire provides individual coaching and leadership development to high-potential managers across the company. These employees get to participate in panel discussions, and they receive 30-plus hours of additional management training per year.
“Prioritize and accommodate diversity; more than just looking for diverse candidates, we must find ways to help advance and accommodate underrepresented groups through our training and development practices,” Skinner adds. “We are the industry of opportunity, and we must continue to make growth and advancement opportunities available to all people from all backgrounds.”
Having an engaged, knowledgeable staff doesn’t just lead to good team morale, but also translates to more sales. Highly-skilled employees who know the ins and outs of the business are less likely to make mistakes, which in turn improves the guest experience and efficiency of the restaurant. For example, Tupelo Honey’s revenue lifted 27 percent in 2022, and guest count jumped 17 percent. Systemwide average unit volumes are now over $4 million, and the company is on track to exceed $100 million across its 21 stores in 2024.
Plus, since launching new initiatives over the past 12 months, Tupelo Honey projects a 15 percent improvement in employee retention this upcoming year, Skinner notes. For hourly workers, minimum wage starts at $15 for non-tipped employees, plus there’s a tenure award program that crosses every level of employment, including part-time team members.
Tupelo Honey recently opened its 21st location in Indianapolis, and Skinner says the company heavily emphasizes explaining the “why” along with the “how” to team members during the training process.
“Our ‘why’ includes why we use a particular product or follow a particular process. These ‘whys’ correlate back to our values,” she says, like why the restaurant prioritizes sustainable and locally-sourced products, the importance of scratch-made food, and creating joy through hospitality. “We are intentional about incorporating ‘whys’ throughout our training to deepen connection and engagement with our values.”
At Parker’s restaurants, employees not only get great pay and benefits, but also opportunities for advancement. One of Parker’s first bartenders is now director of beverages, while multiple employees who started as dishwashers are now managers—which is one reason why the company was able to grow from zero to $100 million in just eight years, he says.
“If you can give [employees] the culture where they enjoy going to work every day and you can show them the growth, they’ll stick around,” says Parker. “It’s about reinvesting in the people, and then you can reinvest in your assets and grow. And you’ve got to find the balance between the two.”
Sometimes, finding that balance means cutting into profit margins for the betterment of employees and culture, he notes, like adding more staff and managers so people can take their vacation days and have a better work-life balance, which helps mitigate burnout. Parker tried out a four-day work week over COVID, but the timing didn’t pan out with staffing shortages. Now, he’s looking at scheduling in a similar way to nurses who work long shifts for three days, then get four days off.
“If you do the math, that’s a lot of days off a year, right? You’re only working one-third of the year, and I think that’s a big incentive for people to come and work for a company,” Parker says. “I have those days where I can just enjoy my life. Travel, too. If you get back-to-back days, it’s easier to take your vacation days.”
“I do think we’re going to come up with a system that will hopefully revolutionize some of the restaurant industry, but it’s a work in progress. We’re always trying,” he adds.
Employees forget 70 percent of what they learn within just three days when using traditional methods, according to 1Huddle—a workforce coaching and development platform that helps organizations and global clients train employees with quick-burst games. “The way we train employees in the restaurant space is sort of embarrassing at times. We lock them in a room, have them watch a video, click through it, and watch it enough times until they pass,” says Sam Caucci, 1Huddle founder and CEO.
The platform was designed to be a solution to the outdated approach to coaching, training, and development at companies.
“Innovation is happening around the entire experience inside of a restaurant, and in hospitality, innovation always starts with the guest, then comes into financial softwares, then goes into the back-of-house,” Caucci continues. “We’re at the stage right now where the best brands are choosing to invest aggressively in innovation around their employee experience.”
For example, Jeff Carcara—CEO of Whiskey Cake, Sixty Vines, and Mexican Sugar under Front Burner Society—was “blown away by the knowledge of items and ingredients within a few days” after employees learned a new menu rollout by playing games on the 1Huddle platform.
“Information retention is significantly better than the old-fashioned cram for the test then forget,” Carcara continues. “We can have an employee play a game to develop deep expertise on any topic we believe is relevant.”
Additionally, by eliminating paper and using games for employee coaching, Carcara has noticed less points of friction that have existed for decades, as well as a favorable impact in employee engagement and knowledge levels. “The science is hard to argue,” he adds.
Sixty Vines is a casual dining concept which pairs kegged wines with charcuterie boards and other shared plates, while other FB Society brands include The Ranch, Velvet Taco, Ida Claire, Haywire, and Son of a Butcher Slider Bar. Though Carcara notes Sixty Vines is “by no means perfect” and still has “plenty of work to do,” a focus over the past two years on implementing paid time off for all full-time employees, complimentary mental health support for all team members (including part-time workers), providing clear career pathways, and more have helped the restaurant collective stay fully staffed since mid-2021 at the majority of FB Society concepts.
Plus, management turnover was less than 10 percent last year, Carcara says, driven by a culture that celebrates a work-life balance (i.e. managers get one four-day work week per month). “When we treat people the way they want to be treated and make decisions through that lens, we create a compelling place to work,” Carcara adds. “That, coupled with the potential to make great wages and tips, creates a meaningful employee value proposition.”
“I don’t think there’s any more powerful workplace trend than to make sure every player on the team has the opportunity to compete,” adds Caucci.
“Nobody likes an unfair game. Not every worker is starting at the same level in our workforce; some folks have been advantaged to start a few levels ahead,” Caucci continues. “It’s our responsibility as leaders in the restaurant space to afford everyone in our workforce, on our team, the opportunity to be successful.”
Simplifying the hiring process
With so many open positions for retail and hospitality jobs, employers need to prioritize an efficient hiring process to ensure applicants are moved through the system quickly. “Speed in contacting candidates can sometimes be your biggest advantage,” says Skinner.
Tupelo Honey hosted its first annual National Hiring Day in 2022, where all locations across the company closed to focus on staffing. Fresh, scratch-made biscuits were offered to any candidates who came out for an interview, and the restaurant utilized social media platforms to get the word out about the event and sign-on bonuses.
“When it comes to hiring, try new strategies, but pivot quickly when those strategies don’t work,” Skinner adds. “Sometimes, being the first person to tap into a particular candidate population has the biggest return. In the fast-moving world of hiring, you never know what works until you try it.”
At California-based Black Bear Diner, job seekers have the option to apply for open positions online or by text or chat using TalentReef, a platform the nearly 150-location chain recently began using. “We have worked hard to make applying to Black Bear Diner as simple and seamless as possible for applicants,” says Tammy Johns, chief people officer.
“We are constantly updating the open positions on our own website, as well as on job listing sites like LinkedIn and Indeed, to attract a broader pool of applicants and meet them where they are job searching,” she continues. “We strive to make the application process as simple as possible to limit applicant drop-off.”
Meanwhile, American Social took a step back to evaluate team members’ first impressions of the restaurant and made it a priority to simplify the application and hiring process, Herchuck notes.
“We cleaned that up and made it simple by removing things that were time-consuming without any real relevant purpose; for example, pre-testing for roles that do not require previous experience,” Herchuck says. “Some of these [steps] were intimidating and would turn away applicants who do not have a lot of experience in this process.”
American Social also looked at how quickly the team was able to review applications and set up interviews with potential employees. “The days of saying we only do interviews on Tuesday and Thursday from 2-4 p.m. are outdated, and I’m sure those places continue to struggle with staffing,” Herchuck says.
“We have found that being flexible and letting the team member tell us when they would like to come in, of course with parameters, goes a long way for showing care for their time,” he continues. “Empowering them to be a part of the process from the beginning sets the tone for their overall work experience.”
Additionally, American Social leaders are trained to conduct interviews by splitting their time between asking tactical questions and getting to know the candidates, but also spending time letting prospective employees get to know them and the company.
“We encourage them to ask us questions and tell them that this interview goes both ways, selling AmSo to them as much as it goes the other way,” Herchuck says. “This catches some people off guard, which is OK, and tends to be more of a conversation than a formal interview.”
Increasing engagement and retention
Blasting Rihanna’s “I Want You to Stay” on repeat throughout your restaurant isn’t enough to stop employees from leaving anymore. The modern workforce is looking for flexibility, work-life balance, boosted pay and benefits, a positive company culture, interesting training, and career development opportunities. And while a long list like this can be daunting for operators, taking steps to improve each area of the business will pay off in the long run.
To increase team member engagement and enhance talent development, Black Bear Diner recently rolled out a learning management system called “Bears in the Know,” which team members can use to find helpful training resources including everything from harassment and discrimination training to culinary training, COVID-protocol training, and more.
The system also offers diversity and inclusion training, which features resources and information on different topics each month. For example, during the month of June, Black Bear Diner included resources on the LGBTQ+ community and Pride month, and shared information on Black History Month in February.
“Through this system, we strive to create an inclusive environment where all team members can truly be themselves, engage with others, and feel supported by the Black Bear Diner family,” says Johns.
Despite facing widespread industry challenges with staffing in 2021, Black Bear Diner was able to hire approximately 100 team members in 2022, in addition to increasing competitive pay and benefits, like a Safe Harbor 401(k) plan, health insurance, on-demand virtual healthcare with HealthiestYou, and even pet insurance. The diner chain ended last year with 10 percent less manager turnover than in 2021, and is now experiencing a better turnover rate “than most others in the family dining segment,” Johns notes.
“We encourage our managers to conduct ‘stay’ interviews with their team members by continually checking in individually with them,” she says. “We want them to have open and honest conversations about how they can strengthen their team members’ engagement and create more positive experiences, both of which typically result in increased retention and promotions from within.”
Black Bear Diner is proud to consistently be at or above the 50th percentile for pay within the industry, Johns highlights, which has also helped the brand increase team member retention.
“Each year we do a review of wages within the industry, taking note of industry averages, how things are shifting, and what other companies are doing,” she continues. “We use this information to evaluate our own company’s wages and update our pay to keep up and above industry standards.”
At nine-unit Grove Bay Hospitality, rolling out retention bonuses and extending health insurance benefits to part-time workers has helped mitigate turnover. The Miami-based restaurant group behind the Michelin-starred Stubborn Seed has a vast network of celebrity chefs like Marcus Samuelsson, Top Chef champion Jeremy Ford, Richard Blais, and Janine Booth and Jeff McInnis, to name a few.
“Being a homegrown hospitality group, we understand the importance of being connected to our community, and that concept of community is reinforced throughout all of our restaurants,” says Francesco Balli, Grove Bay’s CEO and co-founder.
Grove Bay recently brought on a director of training and development, plus a corporate training manager, to have a full team dedicated to increasing employee learning and engagement. The hospitality group is also evaluating a potential internal social network to extend team member recognition in a public manner, in addition to recently awarding the first round of scholarships to students at Florida International University from the Grove Bay Foundation, which was created to provide funding to students who want a future in the hospitality industry.
Ultimately, 1Huddle’s Caucci believes the future of the restaurant workforce “isn’t robots delivering food to my table; the future of work is a place where people that come to work are not just coming with the right skills and information, but they’re bringing their best selves to work with them each day,” he adds.