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Attracting Restaurant Employees: Real-Time Pay and Other Strategies that Work

happy-restaurant-employeeThe woes of the restaurant industry have been well-reported – and if you’re an owner or operator, you know about them first-hand. 

Three-quarters of the restaurant operators recently surveyed by the National Restaurant Association report that recruiting and retaining employees is the top challenge facing their business. In January 2021, that number was only 8%, the association said in its mid-year report. This is the largest problem with recruiting and retention reported in the nearly 20 years of the association’s monthly survey. 

Some of the workers who became unemployed due to the pandemic will never come back, choosing different careers or jobs that don’t expose them to the public. Others will wait until vaccination rates are up and they feel comfortable returning to work. And, of course, restaurants are hiring at the same time, so competition for workers is fierce, and employees can choose the workplace that best suits them. 

To help with hiring, restaurants are significantly improving compensation and benefits. Wages for hourly workers in leisure and hospitality jumped 13 percent to an average of $16.60 in August, up from $14.72 a year ago, according to a New York Times article. 

But another great way to attract restaurant workers – one you may not be familiar with – is real-time payout of those tips and wages. And fast access to money earned isn’t just an advantage to employees; restaurant operations can benefit, too – today and tomorrow. 

Real-Time Pay is a Real Time Saver for Both Employee and Employer 

Real-time pay offers employees flexibility in when they get paid – even daily if they prefer. Here’s how it works: 

  1. Implementation and enrollment are quick and easy for both restaurants and employees. Restaurants can continue to use their current payroll vendors. 
  2. After employees have enrolled, you can select payout recipients and amounts for them at the frequency they choose. 
  3. Recipients receive an email or text notification and verify their identities. 
  4. Funds are pushed to their checking accounts via the debit card for that account – no new card or app required. Money typically arrives within 30 minutes, depending on the financial institution. 
  5. Payments can be made 24/7/365. 

In addition to attracting employees, same day pay offers operational advantages: 

  • It eliminates the need for cash tip-outs, sending earned tips to employees at the end of every shift. That saves time by reducing bank runs and the need to count and distribute cash. It also improves security because you aren’t keeping large amounts of cash on site.

  • It provides real-time cash flow visibility so you can see when money is sent and claimed by employees. All data around tip payouts can be easily exported and uploaded for reconciliation, too. 

  • And because it’s done electronically, same-day pay reduces the cost and labor of manual paychecks for those still using them. That means less printing and mailing for you.  

While fast access to wages is attractive to many employees, it’s a particularly smart move in today’s gig economy. Restaurants have lost employees to jobs where work today, get paid today is the norm. Real-time pay eliminates that competitive advantage and may bring some restaurant workers back. 

Other Ways to Attract Workers: Bonuses, Time Off and Training 

Along with same-day pay, the following strategies also can help you recruit employees, according to the experts. 

Pay referral bonuses. If your employees enjoy their work, they’ll tell people they know. Use this to your advantage by making employees your best recruitment tool. Offering referral bonuses for employees who bring in people to interview, upon hiring, and again after 90 days encourages retention, while increasing your recruiting channels. 

Provide profit sharing or bonuses. The restaurant industry began exploring non-traditional compensation even before the pandemic, but such options have become even more critical. Offering employees a greater stake in success via profit-sharing or bonus programs costs money – but it also can boost productivity, satisfaction and retentionso the results may well be worth the investment. 

Offer paid time off and sick leave. In a market where prospective employees have choices, you’ll need to figure out what makes your restaurant the best to work for. In addition to bonuses, consider paid time off and sick leave, which shows employees you are concerned about their health and well-being, both during and after a public health crisis.  

Establish opportunities to learn and grow. The day-to-day reality of running a restaurant often means employee development is put on the back burner – or is nonexistent altogether. But learning opportunities that you can promote while recruiting can attract candidates. 

And since many restaurant workers leave for lack of career path, training, new job assignments and promotions offer them a chance to build on their skills and progress into new roles. If your employees see a future with your organization, they are more likely to stay, improving retention and reducing the need for recruiting in the first place. 

Create Lasting Advantages 

Without adequate staff, restaurants can’t do as much business. Many restaurants aren’t opening for lunch and/or are closing their doors an extra day or two each week because they lack employees. On the heels of a bad year, it’s even more important to get up and running at capacity as soon as possible, and attracting and hiring new employees is critical to that effort. While increased compensation, additional benefits, and fulfilling careers can help you recruit and retain workers, so can putting money into the hands of your employees faster. 

But perhaps more important, real-time pay offers recruiting advantages and operational efficiencies that will last long after the pandemic is behind us. Someday, we’ll be back to some version of normal. If you implement real-time pay now, you’ll be ready for that day – and for whatever challenges are sure to come to the industry in the future. 

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