One of the most challenging aspects of running a restaurant is managing the workforce. In a booming economy, restaurants face competition from other employers who are willing to bid up wages and benefits. Restaurant owners also face twin legal dangers from heightened public awareness of sexual harassment claims and from an explosion in the number of immigration raids.
Adding to those challenges are demands to improve efficiency. The best in this business know that in order to attract and retain good employees and avoid legal pitfalls, you must have strong HR practices in place. A lack of recruitment and hiring processes can often lead to bad hires, high turnover and an overall poor reputation as well as damage to the brand. The following seven practices can boost operations and, in turn, improve profits.
Streamline Recruiting and Onboarding
Finding new workers is expensive. It can cost $4,129 per employee according to the Society for Human Resource Management. The global organization found that it also takes time, about 42 days, to post openings, review resumes, interview candidates and send prospective hires through background checks and drugs tests. The above number may be even higher when factoring in training and lost productivity during the transition. Effective owners have a strong internal system or recognize the benefit of turning those tasks over to companies that are better at taking job prospects through the initial steps.
Managing the processes needed for new hires can drain a business owner of time and money. Electronic onboarding can eliminate the need for significant paperwork, and can increase the accuracy of records while reducing administrative costs. It also cuts down on miscommunication, a common cause of problems during a worker’s first days. A good electronic onboarding process efficiently puts workers on the job, setting a strong foundation for a good working relationship between a restaurant and its employees. This can ultimately lead to increased retention, which means lower recruiting costs and higher return on investment from training.
Offer Competitive Benefits
Over one-third of restaurant operators and bar managers say their biggest challenge to success is staffing. Attracting good workers is only going to get tougher as the pool of applicants shrinks due to demographic changes and tuition reimbursement campaigns put forth by companies such as Walmart. Forward-thinking owners can provide tuition assistance, just as Starbucks, Chipotle, McDonald’s and Yum Brands do, by partnering with firms that can manage that and other valued benefits.
Why would that offer have been considered unnecessary seven years ago? The economy and workers expectations, both of which have changed dramatically. In 2011, the national unemployment rate was nine percent. Now, it’s less than half that. And the number of people 16-24 years of age has leveled off at about 39 million, according to the U.S. Census Bureau. Given that restaurants employ one-third of all working teens, offering young people a valuable benefit can improve retention rates.
Train Workers (and Bosses)
One of the worst experiences a new employee can have is to show up for the first day on the job, be handed a uniform and be told to get to work – without any training or direction. They’re likely to fail and quit, especially when a bad boss harangues them for not performing well. Sub-par supervisors and co-workers are leading reasons people quit their jobs.
The best workers expect training, so owners benefit from developing programs that lead employees to success. Those happier employees are more productive and more profitable for the business. Good bosses provide handbooks and training manuals, and review checklists to prepare workers for any situation. Mentor programs can improve employee loyalty.
Eliminate Workplace Harassment
The #MeToo movement has come front and center in today’s culture. Any restaurant that develops a reputation for sexual harassment of its employees should expect its business to suffer. Managers are responsible for providing a safe working environment, and they should be expected to address harassment complaints immediately.
Smart owners have clear, well-communicated policies and take strong action when those policies are violated. A company of professionals well-versed in the law and best practices can educate employees on what constitutes improper behavior and set up communication channels for reporting violations. This can also help owners respond quickly and firmly to any complaints.
Streamline Payroll Processing
Almost three out of four workers in the restaurants-accommodations sector separated from their employers in 2016. That’s a lot of W-2 forms. Time-conscious restaurant owners turn over the recordkeeping and record filings to a firm that has expertise and resources to devote to staying current with tax rules. Executives who oversee operations in multiple states make use of electronic systems that generate accurate paychecks and don’t miss the deadline for filing quarterly tax forms and other required reports.
Stay Current with Employment Laws
Immigration and Customs Enforcement (ICE) is raiding not just meat packing plants and 7-Eleven stores, it is going into restaurants. The owner of a dockside Baltimore restaurant lost 30 workers in one day after ICE agents showed up and demanded their papers. In Michigan, immigration officers ate breakfast in a restaurant before barging into its kitchen.
While undocumented workers suffer jail and deportation, restaurant owners can be fined and arrested. The number of I-9 audits has already doubled in the past six months from 2016-2017 levels, and arrests have more than tripled. Smart owners maintain accurate paperwork and have procedures to avoid large fines and possible criminal penalties. ICE has announced that it will increase I-9 audits this summer, so restaurant owners need to step up their game to ensure that they comply with current law and government policy to avoid operations disruptions and bad publicity. Because the rules are complex and enforcement actions are becoming more aggressive, owners should consult with legal experts.
Enlist Some Expert HR Help
Handling these crucial responsibilities alone with limited in-house administrative support is not the only option. HR outsourcing may offer a significant value by increasing productivity, reducing liability, minimizing time spent on paperwork, and decreasing overall labor costs.