"Most of our employee base and potential employee base live paycheck to paycheck. Any increase in gas price cuts into their disposable income." That statement comes from an Applebee's executive. It seems like it's the beginning of a compassionate message, and, indeed, his email ends with this:
Do things to make sure you are the employer of choice. Get schedules completed early so they can plan their other jobs around yours. Most importantly have the culture and environment that will attract people.
It's what's in the middle that's problematic. The email, leaked in Reddit's Anti-Work subreddit, identifies the executive only as Wayne, who focuses on how the trials of the employees are a good thing for Applebee's. His logic is as follows:
- Government unemployment checks are ending, forcing people to get jobs.
- Rising prices due to inflation are causing small businesses to close.
- High gas prices mean people need to work more.
- Fewer businesses will be open, so more people will be looking for jobs.
- Therefore, Applebee's can hire people at lower wages.
Here's why this is problematic.
Your employees' financial problems are not for your benefit.
Wages are costly, and many companies operate at low margins. Everyone understands that businesses don't want to pay any more than they have to for employees. However, seeing people struggle, and living paycheck to paycheck as their costs increase, is not cause for rejoicing.
In the same email, you cannot say you are concerned about employee morale and celebrating lower wages.
Turnover is incredibly expensive.
Always assume everything you write will end up on the internet. Even if Wayne is correct in his predictions and higher gas prices ultimately mean lower wages (doubtful), he's left out one colossal cost: Turnover.
In 2016, the Center for Hospitality Research at Cornell estimated the cost to hire and train front-line restaurant employees at $5,864 per employee. Restaurant turnover is always high, and right now, it's the highest of any industry. While Wayne is gleefully counting his pennies, he should think about the dollars he's losing if his employees leave.
It's cheaper to treat employees well and pay them above average than to have to hire and train new ones.
Unions are on the rise.
Starbucks stores are unionizing rapidly, with their seventh store voting to unionize in a 9-0 vote on March 22, 2022. Why should Applebee's care?
Because the Starbucks organizers aren't content with the coffee shop. One activist said, "We want to kick down the door in the entire food service industry." The unions aren't stopping, and Applebee's better be prepared.
"Starbucks is the start of this movement, not an endpoint," warns employment attorney and partner at Wickens Herzer Panza Jon Hyman.
Treating your employees like this--even behind what you think are closed doors--increases your likelihood of the unions knocking at your door. Your best bet to avoid unionization is to keep your employees happy.
Not keeping a unified message.
Kevin Carroll, chief operations officer at Applebee's, says this isn't an Applebee's opinion, but Wayne's alone. He says
This is the opinion of an individual, not Applebee's. This issue is being addressed internally by the franchisee who employs this individual and who owns and operates the restaurants in this market. Our team members are the lifeblood of our restaurants, and our franchisees are always looking to reward and incentivize team members, new and current, to remain within the Applebee's family.
While the rules between corporate responsibility and franchise responsibility change from time to time, one thing remains clear: No one thinks about the franchise owner in this type of debacle--they think about the parent corporation.
You need to make sure all your management teams everywhere focus on keeping employees happy, not hoping you can pay them less. This principle holds in small businesses and global giants. You don't get to control the public relations for your company anymore. Everyone has a voice, and sometimes that voice goes viral.