Hospitality has long been one of the toughest industries to work in. In an industry where employee turnover is already very high, the COVID-19 pandemic has made it even harder for restaurants to stay open and therefore retain staff.
This was one of the main discussion points at our Sustainability Breakfast last week, which was on the topic of our August theme: ‘Treat Staff Fairly’. A big thank you to Suzanne Storms, Principal Instructor at the International Culinary Institute and Food Made Good Advisory Board Member, and Peggy Lai, Director of Human Resources at Classified Group, for giving us their perspective on how we should be treating our employees.
This month’s theme ‘Treat Staff Fairly’ sits under our Society pillar. By taking action in this area, you also, in some shape or form, working towards meeting the UN Sustainable Development Goals (SDGs) 4 (Quality education), 8 (Decent work and economic growth), 10 (Reduced inequalities), 12 (Responsible consumption), 13 (Climate action) and 16 (Peace, injustice and strong institutions).
Credit: Shirota Yuri
Restaurants are difficult businesses
According to Suzanne, there are several long-established issues that contribute to a lack of fair treatment in hospitality. One of which is that running a restaurant under a traditional business model means there are high costs but low profitability. High costs create a knock-on effect as restaurants often turn to reducing staff salaries or additional benefits in order to save costs. In cities like Hong Kong, costs are even higher due to the exorbitant rent and the effects of this have been clear during the pandemic, especially as many landlords have been reluctant to lower the rent. Most restaurants now depend on takeaway, delivery and government assistance but this may not be a sustainable solution. Unfortunately, many restaurants around the world have shut down because they can’t support themselves.
Suzanne also made the interesting point that customer expectations can influence the profitability of restaurants. Customers often compare restaurant prices with grocery store prices and will therefore not accept having to pay high prices for a meal. In order to attract the customers, restaurants will choose to keep prices low, but this means breaking even will be extremely difficult. Restaurants may have to rely on offering special deals and promotions.
Many restaurants may think that offering staff benefits is another additional cost that they would rather save. On the other hand, replacing employees is expensive; a high staff turnover of 12.3% (2017) costs the hospitality industry millions every year and has a negative impact on the company’s morale. It has been proven repeatedly that staff retention is key to a successful business and it is time we invest in our employees.
Credit: Andrea Piacquadio
Staff are our most valuable asset
For Classified Group, employees have always been the priority; in fact, putting employees first is the company’s core value. According to Peggy, simply looking for a quick fix solution to minimize costs towards staff is not the behaviour of a responsible employer.
In response to the pandemic, the Group have made many internal adjustments to avoid having to ask employees to take unpaid leave and to ensure that everyone in the company could keep their jobs. This included adjusting operating hours, changing work schedules and trying to accommodate employee’s expectations based on feedback from the different heads of departments. This reflects the work culture at Classified, with employees working together and supporting each other like a family. Having such a culture is clearly a successful strategy; after working in other companies, many employees have returned to Classified because they felt respected in the workplace.
Boosting staff morale is vital to improving staff retention and while it may seem expensive, offering additional benefits can save money in the long run. These benefits could be as simple as recognising and rewarding good performance, offering free uniforms, offering free meals per shift or providing a travel allowance. Even ensuring that the workplace is safe is an often-overlooked element, especially in Hong Kong where we have cramped spaces. In a survey conducted by the Occupational Safety and Health Council (OSHC), 34% of kitchen staff said that their prime concern about their employment is a safe and healthy working environment.
You should also ensure you are paying staff fairly, with salaries in line with their job responsibilities, skills and experience. You could also offer comprehensive staff training schemes and help with your employees’ career and personal development.
As Peggy mentioned, Classified Group offers a 12-month training programme, giving workers the opportunity to train in all areas of a restaurant, both back-of-house and front-of-house as well as in the head office, including in HR, marketing, finance, etc. Having a thorough understanding of how a restaurant works means that the employee will be a more successful worker. Training programmes are also the perfect opportunity to teach your staff about sustainability issues, creating the buy-in for when you choose to make changes to your operations to become more sustainable. Not only are these benefits a great investment in your employees, it would also give you a competitive edge if you are able to offer perks that other businesses don’t.
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Credit: Kenny Luo
Investing in our future chefs
Not only should we be looking after our current employees, we must also remember to look after our future employees. “The first placement is key to the rest of their careers and lives”, says Suzanne. Many chefs in other parts of the world got their start by working as an apprentice at the age of 15 or 16, working their way through the ranks to become the successful chefs they are today, but this is not as common in Hong Kong. Just like any other career, being a chef is hard work and if we can offer our future chefs the right training from a young age, they can also help boost your business and the F&B industry in general.
Peggy agrees that we need to look after our students. For the past few years, Classified Group have partnered with The Hong Kong Polytechnic University through the university’s restaurant visit program. Peggy sees this as a way to give back to society as the program allows hospitality students to visit a real workplace, helping them decide where they want to work and influencing their future careers. Many hospitality students often believe that their only option is to work in a hotel or will choose another career entirely after graduation, so it is important to help students understand all their options.
Happy employees make happy customers
Ultimately, investing in your employees means you are helping to create the best experience for your customers. Staff that are treated fairly are engaged and productive, and their positivity will be reflected when they interact with customers. Offering additional benefits may seem expensive but it is a worthy business strategy. If your customers feel that they are receiving the best customer service, they will be more likely to return as well as recommend your restaurant to others, increasing your business’ long term viability.
Treating staff fairly is crucial to operating sustainably. Improved staff wellbeing will help towards making hospitality a positive career choice and improving the sustainability of the industry as a whole.