How AI Is Enabling Restaurant Labor Compliance

When we talk about the “restaurant of the future,” labor compliance isn’t exactly the flashiest or most exciting topic to include—certainly not when juxtaposed with salad-making robots and personalized digital menus. But beyond its legal necessity, ensuring compliance with employment laws is critical to shaping a better experience for employees and customers alike.

Restaurants face a multifaceted compliance situation. In addition to more wide-ranging compliance requirements like general health & safety guidelines and local labor laws, there are food and beverage-specific safety regulations, requirements for specialty licenses (such as those to serve alcohol), and unique stipulations on labor compliance, many related to the employment of minors. Should restaurants fail to comply with these requirements, they can face severe legal and financial consequences, not to mention serious harm to their reputation.

To make things even more challenging, labor compliance laws evolve constantly and vary across jurisdictions, which can exacerbate compliance risks for restaurants operating in multiple locations. We have seen this recently with California’s new minimum wage for fast food workers, as well as the phasing out of tipped wages in Washington, D.C. Moreover, new developments in Fair Workweek laws, such as the ordinance that just passed in Los Angeles County, contribute even more compliance variables for restaurants to navigate.

Restaurants should not make managers and employees fear compliance. Instead, they should see it as an opportunity to start an important conversation about the employee experience. By leveraging compliance as a positive force – rather than simply another box to check – and coupling it with strong employee benefits, they can provide a better place to work. In these discussions, leaders should stress the importance of technology in making compliance easier and more directly intertwined with the employee experience.

To make compliance as simple, streamlined, and intuitive as possible, restaurants should make the most of advancements in artificial intelligence (AI), which is quickly becoming an industry standard. AI-powered workforce management (WFM), when used to enable the intelligent automation of compliance, can help restaurants remain compliant while saving valuable time and optimizing resources. Automating key labor management processes and increasing the visibility of compliance insights removes the guesswork and minimizes risks, allowing restaurant operators to refocus their energy on keeping the kitchen running smoothly, workers happy, and customers satisfied.

Understanding Compliance Pillars

To properly apply an AI strategy to labor compliance, restaurant managers and operators will require a thorough understanding of the various compliance pillars AI can assist, and how. This will give them an informed perspective on how the technology can best benefit their business.

The most efficient way to automate compliance is through an AI-driven WFM platform, which serves as the nexus for staffing, scheduling, payroll, and other key operations functions influenced by labor laws. Restaurants should adopt WFM technology with AI at the core to maximize the potential for automation.   

An intelligently automated WFM system helps restaurants apply labor compliance rules and enforce them in an automated fgashion, reducing extra considerations for managers. This includes:

• Preventing “clopenings” that leave workers burnt out due to a lack of sleep and proper work-life balance.
• Ensuring predictive scheduling, so employees know their schedules in advance and can easily coordinate them with their personal lives or other responsibilities, such as a second job or school.
• Accounting for any other stipulations outlined in local labor laws.

AI is also helping restaurants to manage an increasingly multigenerational workforce. According to new research, over half of managers noticed changes in the ages of the hourly workers they’re hiring in the past year, whether they’re hiring more minors, more employees 65+, or both. Restaurants and bars face especially unique challenges in hiring minors, as child labor laws around the country are changing in response to shifting labor demands, and teen interest in jobs is rising. New policy developments may further restrict how long these young employees can work, and when – and the laws differ across jurisdictions. For example, a manager in a jurisdiction with a curfew for teens under 18 would need to account for that when scheduling employees, while a manager at the same franchise in a different city might not.

With expert systems AI present in the WFM platform, managers can automatically generate schedules that balance employees' needs and incorporate complex compliance parameters. These decision-making algorithms account not only for staffing times and locations but also for specific roles and stations within the restaurant, which keeps minor employees from using equipment or handling materials they aren’t legally authorized to work with.

In all, an AI-powered WFM platform helps to keep compliance at the forefront by automatically accounting for and enforcing various compliance pillars across all teams and locations.

Harmonizing Labor Optimization with Compliance

Labor compliance only forms one part of a restaurant’s overall labor strategy, which plays a pivotal role in business operations, employee experience, and customer satisfaction.

Restaurant owners and operators should prioritize uplifting their managers in their labor strategy efforts. The burden of ensuring labor efficiency often falls to managers, who are already overwhelmed with managing front-of-house, kitchen, and backend responsibilities–in addition to training new employees and interacting with customers. Giving them the tools they need to succeed will minimize risk while maximizing productivity.

An AI-native WFM platform can easily and efficiently create an optimized labor plan, greatly reducing managers’ scheduling and staffing woes. But these optimized plans go beyond who is available and when. True labor optimization aligns schedules with workers’ skills, permissions, and preferences, as well as projected demand and staff availability. It gets granular, which is precisely why restaurants need to support their labor experience gatekeepers with the proper technology – that way, they can achieve that granularity with minimal administrative headaches.

AI can also soothe headaches of the legal sort. A WFM platform with AI at the core arms managers with the insights and automated tools they need to maintain a safe and compliant workplace, while simultaneously reducing the actual effort they have to expend on it. With this time freed up (and their minds at ease), they can invest more deeply in customer service and staff training. Having more time to train new employees will result in a more educated and efficient team, which can further promote compliance since employees will be well-versed in compliance protocols while creating a better experience for customers

The Potential of Generative AI

Generative AI has made headlines for disrupting the white-collar workplace, but exciting new technologies can have an equally transformative impact on restaurant and food service settings.

Restaurants are already becoming more technologically forward, from interactive QR code menus to tap-to-order kiosks to reservation apps like OpenTable. According to a study from Hospitality Technology, 78 percent of restaurant IT budgets will increase in 2024. Given this, genAI is most likely to show up as a new feature in technology restaurant workers already use. Ideally, genAI will make it easier for employees to do their jobs by acting as a virtual assistant; in conversing with the assistant, employees can bypass complicated processes and get instant access to the information that will make them more productive.

On the compliance side, the genAI assistant can instantly deliver answers to compliance questions, guiding actions and reducing the risk of error. For example, if a manager is unsure whether or not a fifteen-year-old employee can operate a certain piece of equipment, they can receive a direct answer from the virtual assistant; they won’t have to go rooting around in booklets or PDF files in the back office and avoid making a potentially dangerous error.

The result? A safer, more trustworthy establishment that will keep employees on staff and customers coming back. When a restaurant fulfills compliance requirements, diners can rest assured that their meals were prepared in a safe, healthy environment – and they’ll likely have better interactions with staff to boot. Happy employees really do make for happy customers, and a compliant workplace will undoubtedly be a more positive one.