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Good Benefits Attract and Keep Restaurant Employees

November 19, 2019

Original content c/o: National Restaurant Association

Full-timers especially are looking for a full plate of benefits. Tiered health-care plans, tuition reimbursement, even tattoos are in the offing.

Employee Benefits

Good benefits are a badge of honor in the restaurant industry: “Get benefits worth bragging about,” touts a listing for one restaurant company’s management position.

“If you aren't offering benefits to managers, you aren’t going to get them,” says restaurant consultant and accountant Rick Braa, owner of AMP Services LLP, Seattle. Braa works with nearly 200 restaurants in myriad capacities including setting up benefits packages. “The cost of richer benefits has to be weighed against the cost of turnover, which is reported to be anywhere from about $2,000 to replace a front-line server or dishwasher, to $10,000 for a manager,” he says.

Companies can offer multiple plan levels, from basic wellness to cover annual check-ups and shots, for example, to plans comprised of medical, dental, and vision insurance. With varying levels of coverage, co-pays and out-of-pocket deductible amounts, an assortment of offerings allows employees to choose their best fit.

“Vision insurance is super inexpensive, so why not add that on?” Braa suggests. “Life insurance isn’t that much of a stretch either when added as an a la carte choice, and it’s a huge benefit for a family when they need it most,” he adds.

One of the newer offerings for Braa’s clients is telemedicine conducted through FaceTime or any phone brand’s app for face-to-face consultations. The benefit is gaining interest and adoption by physicians and patients, according to HealthCareDive, citing a new study by Doximity. It’s becoming common to do face-to-face consults online, says Braa, because users are finding it saves time, especially time off from work.

Beyond health care coverage

Some companies offer 401(k) retirement plans with matching contributions up to a certain percentage. Many restaurant companies are offering tuition reimbursement or subsidy programs for employees working in locations near universities and enrolled in online university courses.

Restaurateurs now offer retention bonuses for staying on the job. These can work well with younger employees who often are tempted to change jobs in an effort to gain higher pay. Some employers pay wellness bonuses for employees who maintain “healthy” lifestyles (non- smokers, etc.) or who have gym memberships.

Offering to cover the cost of tattoos appears to be unique, at least for now, to &pizza, a make-your-own-pizza concept based in Washington, DC.

“One company known for good benefits is Starbucks, who former CEO Howard Schultz once said spends more on health insurance than on coffee beans,” says Florida-based Joe Mowery, vice president, employee benefits, with insurance brokerage firm Hylant. “It offers everything from 401(k)s and paid parental leave to tuition reimbursement.”

“We build against that,” he said of the benefit packages he puts together for restaurants. If you are within spitting distance of a Starbucks, you need to compete at their level or you can lose people, warns Mowery, who has about 15 restaurant groups as clients.

Managers who hold their positions at least two to three years are especially in high demand in the business, and restaurant groups are luring them with added benefits such as retirement plans, paid vacation time, and health-care coverage for domestic partners.

For a really experienced, reliable manager, you definitely want a 401(k) plan, Mowery says.

Build up benefits over time

Braa offers additional advice for those looking to set up their benefits programs:

“Try not to offer all benefits all at once,” Braa says. “You want to be able to offer a steady stream of improved benefits to employees the longer they stay with you.” A restaurant can offer a medical plan with a high deductible the first year and then introduce a health savings account the next, and follow it with dental and vision, for example, Braa explains.

A restaurant company also can increase pricing a couple of percentage points as the benefits package improves.

“Earn trust with your employees and you can build up a very good benefits package in about five years. The promise of additional benefits is definitely incentive to stay,” Braa advises. Benefits layered in over time are an effective way to reward loyalty and performance.