Lending a Hand
Some operators are finding that by reaching out to others in their communities they are better able to hang on to their employees.
By Bradley Pine

"The most serious issue for employers today — in all industries — is hiring and keeping qualified and capable employees," says Donald Marshack, senior analyst at the U.S. Bureau of Labor Statistics. "There really has never been a comparable time, in terms of labor shortage, in our history."

The labor shortage is especially critical in the restaurant industry. Tableservice- and quickservice-restaurant operators alike say that their biggest challenge is finding qualified and motivated labor, according to National Restaurant Association research. And retaining good workers seems to be just as difficult. More than 250,000 restaurant employees give notice every week, according to People Report, a Dallas-based research-and-consulting company that specializes in human resources.

The cost of turnover alone is incentive enough for the industry to consider how to address its labor challenges. According to a 1999 People Report survey of 50 companies in the hospitality industry, the median cost for losing a single hourly employee is $2,494. At the management level, the median cost is more than $24,000.

The bottom line is that holding on to high-quality employees is cost-effective. And some restaurants have a secret recruitment-and-retention method — community service. Over the last several years, many businesses — restaurants included — have taken their traditional charitable giving and community work and promoted them not only as things that are good for customers and a positive corporate reputation but also as a benefit to attract employees who are increasingly concerned about doing well by doing good.

The many aspects of how restaurant owners, operators and employees contribute to their communities will be showcased during Community Involvement Day, on Monday, May 22, at the National Restaurant Association Restaurant, Hotel-Motel Show in Chicago. It will be part of the lineup of themed days at Show 2000-A Global Summit & Exposition.

Generation do-good

Of course, community involvement is nothing new for restaurateurs. According to National Restaurant Association research, nine out of 10 restaurants are involved in community-relations activities. For example, many cities hold a "taste of" event for which the local restaurant association or chamber of commerce organizes the foodservice community to provide a fun-filled day of food and entertainment, usually to benefit charities.

Washington DC-based antihunger organization Share Our Strength is at the forefront of this effort; it organizes food-and-wine-tasting fundraisers in more than 80 communities nationwide. The events raise in excess of $5 million annually for those in need and involve thousands of restaurants and their employees. "Food-and-wine benefits are a natural fit for the restaurant industry, and it's a win-win situation for everyone involved," says Alyssa Prince, manager of community relations for the National Restaurant Association.

The challenge for restaurateurs is to leverage their good deeds to attract and retain employees, much in the way that they have plied them from a public-relations perspective. To attract good staff, businesses increasingly need to differentiate themselves through the resources and support they provide to employees. And support for employees' community-related interests is high on the list of some workers.

Offering community-service opportunities to employees in an effort to attract committed and high-performing staff has become a trend, says Joni Doolin, president of People Report. "Today's younger employees are not only motivated by promotions, raises and how their company is doing," says Doolin. "They want a work environment that is consistent with their values."

In their new book Generations at Work: Managing the Clash of Veterans, Boomers, Xers, and Nexters in Your Workplace, authors Ron Zemke, Claire Raines and Bob Filipczak contend that the relative youth of many restaurant employees requires a new approach to human-resources management that includes caring for and about others. "This generation [X] still yearns for a sense of family, and they'll look for it on the job if they haven't found it elsewhere," they write.

Part of the appeal of community involvement for employees is that volunteerism and "giving back" to the community has increasingly become woven into the fabric of youth experience. More than 30 states have community-service requirements for high school graduation, and People Report cites studies showing that 73 percent of high school students perform volunteer work. "So it is natural that these young people would expect to be involved in the same sorts of activities in the workplace," says Doolin.

The industry is slowly turning toward the community-service benefit as a way to address its labor shortage. Many operators find that by working with schools and youth-development groups, they are helping to educate a whole new generation of workers about the many career opportunities available in the restaurant industry.

For example, Martin's Caterers in Baltimore has become a national model for community support and employee involvement by successfully adopting a local elementary school and providing opportunities for employees to read to and mentor its students. "There is no doubt it makes a difference to our employees," says President Wayne Resnick.

The National Restaurant Association recognized Martin's Caterers' good deeds with a 1999 Restaurant Neighbor Award. "The Association launched the Restaurant Neighbor Award program last year to educate people about the philanthropic works of restaurateurs and to inspire others in the industry to heed the call for community service," says Prince. "State finalists participated in a range of community events, including scholarship programs for continuing education, celebrity wait-a-thons in which celebrities take on the job of a server for a day and donate their tips to charity, benefit dinners, and Big Brother/Big Sister programs."

Preliminary research shows that a company's community involvement can lead to improved employee retention, says Doolin. Quoting a 1996 study from the Washington DC-based Council on Foundations, she says, "Employees involved in their company's community activities were 30 percent more likely to want to continue working for that company and help it succeed."

In the "People Report" survey of 50 hospitality companies, 88 percent of the respondents involved in community service said that their charitable involvement had a positive impact on employee morale, 64 percent said it increased employee commitment and 33 percent said it helped improve employee retention. None of the respondents felt that their charitable acts had a negative impact in any of those areas.

Charting charity involvement

Different restaurant organizations have taken varied approaches to incorporating community service into their employee-support packages. Some have formalized the activities as a benefit, like health care or vacation time, while others have taken a less formal but equally committed approach. In each case, the goals of improving employee retention, promoting the best possible work-and-service environment, and helping the community are equal priorities.

Buca di Beppo, a Minneapolis-based Southern Italian restaurant with 39 units nationwide, is among the restaurants engaged in community service. Part of the company's philosophy is weaving Buca di Beppo within the local community organizations that they will work with and support. Community service is part of the company's secret weapon. "It helps us to attract and keep good employees," says Jennifer Percival, vice president of human resources. Buca di Beppo hires a "Paisano Partner" (general manager) and "Family Members" (staff) before breaking ground on a new restaurant site. "Part of their job is to identify and get to know the local community organizations that they will work with," says Percival.

It is often through those relationships that new hires are attracted to Buca di Beppo. "By bringing on some local people early, we show our commitment to the area and attract additional employees who share our values," says Percival. Management surveys confirm that Buca di Beppo's record in the community and emphasis on "giving back to the community in full force" is a factor in employee retention and morale.

Nancy Christy and Andrea Craig, co-owners of Wilson Street Grill in Madison, Wisconsin, have solved their staff-turnover problem by focusing on building a work environment that is meaningful, efficient and draws from an underutilized labor pool. About 30 percent of the restaurant's 30 employees have disabilities. Most of the workers are referred by Yahara House, a vocational rehabilitation agency in Madison that works with people with disabilities. Wilson Street Grill has very little turnover. "I don't think we've had a job opening in more than a year," says Assistant Manager Tracy Ferguson. "Our view is that the more employees we can connect with a successful work experience, the better work environment we will have, and satisfied customers will follow."

At Union Square Cafe and Gramercy Tavern in New York City, community service is part of a holistic approach to hospitality. Owner Danny Meyer teaches and expects his staff to practice his five tenets of "Enlightened Hospitality." He asks that his employees "demonstrate extraordinary care and respect for each other, our guests, our community, our suppliers, and our profitability. Each is intertwined with the others and given equal importance," says Meyer. And it seems to make a difference.

"We have a very low turnover rate, even among waitstaff," says Bridgett Watkins, Meyer's assistant. "While we have never polled the staff to see if they stay longer because of our community-service emphasis, I do think we have created one of the nicest and most professional atmospheres around, and that counts for a whole lot."

Although there are many happy stories of how community service helps employee morale, motivation and retention, some industry members still do not yet view community service and employee volunteerism as a priority. "Clearly, this is still new," says Doolin, "and it's not for everybody."

But just as clearly, for those who have made the commitment to support their employees by giving them the opportunity to support their communities, the rewards can be significant. "We couldn't run our business any other way," says Buca di Beppo's Percival. "If we didn't work in the community, we wouldn't get the people we want to work here, and we wouldn't be the company we want to be."