People get into the restaurant business for a lot of reasons but managing complex HR challenges is usually not one of them. As a restaurant owner or operator, you’ve got a lot on your mind – menus, vendors, pricing, and of course keeping your customers well-fed and happy. The problem is, those complex HR challenges – the ones you don’t want to think about it – can become serious problems if you don’t get a handle on them. The good news is, with the right strategy and the right technology, you can dramatically simplify complex HR challenges before they become problems, protect your business, and get back to doing what you love to do.
Restaurant PROBLEM #1: SCHEDULING THE WORKFORCE
You don’t need us to remind you that restaurant profit margins are thin – around 2-6%, according to the National Restaurant Association. With margins like that you want to reduce inefficiencies, starting with labor costs. The number of employees you have staffing your restaurant at any given time is one of the most important keys to success (or failure). Too few staff, and you have unhappy customers (and dismal Yelp reviews). Too many, and you’re burning money. Inefficient scheduling is one of the easiest ways to lose money. It’s like having a small hole in your boat – you won’t immediately sink, but a little water has a way of becoming a lot of water.
SOLUTION: MOBILE SCHEDULING APP
The Paycor Scheduling app is simple but powerful restaurant scheduling software that allows managers to create schedules, approve shifts, shift swaps, and time off requests, and even track employee work hours, all from a mobile phone. Not only will the app save you money, it will save you time. For example, you’ll save time:
- Communicating to staff
- Planning your staffing needs based on historical guest and sales numbers
- Approving shift swaps
- Dealing with payroll questions and tip card adjustments.
Restaurant PROBLEM #2: EMPLOYEE TURNOVER
Historically low unemployment, the rise of the gig economy, and an overall scarcity of talent combine to create yet another headache for the restaurant industry. The research firm TDn2K found that in 2017, quick service saw a 132% increase in hourly employee turnover and a 50% increase for managers. While the trend has thankfully plateaued going into 2020, we’re still seeing an industry driven to adapt to a volatile workforce. The reality is, turnover’s always been an HR problem for restaurants and retail. Consider that the restaurant industry is the largest employer of teenagers (one-third of American teens get their first job experience at a restaurant), who will naturally be more inclined to hop from job to job or quit when school starts. Even if your restaurant is fortunate enough to have a few full-time career employees, you’ll most likely see high turnover there as well, since upward mobility in the business often comes when employees jump ship.
SOLUTION: INCENTIVIZE LOYALTY AND ALWAYS BE INTERVIEWING
To inspire loyalty, start at the very beginning with onboarding. As you bring new employees into your workplace culture, it’s so important to take just a little bit of extra time upfront to make them feel part of the team. New employees need to understand what’s expected of them, their role on the team, and what kinds of rewards or learning and development opportunities they’ll receive for a job well done. The first 90 days of onboarding are critical – learn how to engage your people from day one with our restaurant onboarding checklist.
That said, teenagers won’t work for you forever and students will eventually go back to school. Turnover is a natural and unavoidable part of the business, so it’s important to build a pipeline of talented people who want to work for you when an opportunity arises. An applicant tracking system can help you “always be interviewing” by automating the heavy lifting. Look for an ATS that lets you easily create a fully-branded career site that matches the look and feel of your website, without IT help. Your ATS should also help you find great candidates – look for one that automatically posts to free job boards; the less you have to do, the better. And of course, you’ll want to enable candidates to complete the application quickly, easily and in English or Spanish, from any device they choose.
Restaurant PROBLEM #3: I-9 COMPLIANCE
New hires must complete section 1 of Form I-9 on their first day (or before their start date, as soon as they’ve accepted the job). The I-9 requires employees to provide documents proving their identity and that they’re legally allowed to work in the U.S. Among the many compliance issues restaurants face, I-9 compliance is a unique challenge. Restaurants are an easy target for I-9 audits because the industry employs a high percentage of foreign-born workers who are constantly coming and going. Auditors treat common payroll and employee classification errors as red flags. And unfortunately, there are plenty of errors to make. One common error is neglecting to archive documentation. Another is incomplete documentation. Law firm Jackson Lewis report that 60% of paper Form I-9s are missing, incomplete or contain errors. Quick-serve restaurants that do a high volume of hiring are especially vulnerable to the temptation of rushing or neglecting paperwork. And enforcement is only rising. The Homeland Security 2020 budget increased by more than $300 million and they’re adding nearly 2,000 additional enforcement officers and support staff.
SOLUTION: AUTOMATE THE I-9 PROCESS
Maintaining I-9 compliance is important for all employers, but especially for restaurants, as they are frequently audited. Fortunately, this HR challenge is fairly easy to solve. The surest way to avoid errors is to require new hires to complete their I-9 form online before their first day of work as part of your standard onboarding process. Paycor’s Onboarding solution makes the online process easy and it automatically saves the necessary documentation for you, so you’re always prepared for an audit.
With the right technology and partnership, your restaurant can thrive.
We’ve covered three of the most common HR challenges restaurant owners face and we’ve given you some ideas on how to overcome them. But as a restaurant owner, your focus needs to be on your customer’s experience, not HR. Paycor’s HR & payroll software helps you streamline and optimize your business, so you can save money and time, and focus on what you know best – keeping your customers loyal and happy.