How to Handle HR in Your Restaurant

Beata Grace Beatty

Beata is a Florida-based freelance writer. When she’s not researching and pitching story ideas, she’s reading, walking on the beach, fiddling with home projects, and keeping up with her two daughters.

Unless you’re a one-person show, hiring competent employees and managing employee issues like benefits and payroll is vital to keep your new restaurant humming. If you own a food truck or a small, family-run business, you’ve probably hired staff without outside help; however, if your restaurant is expanding, or you are launching a larger concept, you’ll benefit from outsourcing the human relations (HR) demands.

Portrait of young woman using tablet to manage HR in restaurants

Pitfalls of mismanaged HR in your restaurant.

In the early development stages, you’re likely focused on hiring vendors and suppliers, developing the menu, designing the space, and growing a customer base through personal relationships and marketing. You might not be thinking about the unique HR challenges that can leave you susceptible to problems in the long run. Some of these significant issues that go beyond hiring an enthusiastic and competent employee include employee certification, restaurant industry-specific laws regarding safety and health, payroll and benefits, and employee relations and documentation.

Outsourcing HR helps restaurant owners avoid other issues that can hurt business. These topics are high turnover, paperwork headaches, training, dealing with poor performance, setting workplace benefits, managing safety requirements and harassment claims, and tackling payroll and compliance issues.

How can an HR professional help?

The role of any restaurant HR professional ranges from communicating with owners and managers about employment needs to managing employee termination. The nitty-gritty, in-between tasks include onboarding, proper training, and keeping all HR components aligned with your culture and brand. As an owner or chef, you spend time most economically on food, marketing and customer interaction. Time is money, and while you think you are saving resources by hiring and managing the HR by yourself, most owners and managers end up spending too much valuable time on these non-revenue generating tasks.

Who should you hire, and how much does it cost?

There are various HR outsourcing companies or professional employer organizations (PEOs) from which to choose, so it depends on your needs. Specialists can help whether you are a large restaurant, a tiny business, or you need customized resources. There are also industry-specific firms. The cost of the best overall HR organizations varies. Experts quote rates from $45 to $1,500 (or 4% to 8% percent of an employee’s pre-tax salary) per employee per month, but this cost is usually much less than having a full-time HR employee or doing it yourself. It’s sensible to get a quote based on your specific needs.

Find the right fit for your company.

Once you decide to outsource, hire an HR firm that listens and gets your goals and brand to hire the right people. Communicating your needs to a potential HR firm will keep you, your staff, and customers satisfied and will lead to repeat and new business.

Factors that predict employee satisfaction are alignment, capabilities, and engagement. Proper HR support aligns an employee’s understanding of your needs and culture with their day-to-day tasks. This alignment attracts talent and leads to better resources and an overall environment that keeps staff motivated and using all of their capabilities. The overall product is increased customer loyalty and increased revenue because the employees are engaged with your brand and motivated to work hard with a sense of ownership.

Ultimately, there is no single right or wrong way of handling HR, aside from not having any. You’re the only one who knows whether you need to outsource. If you want to handle issues immediately and be directly involved in all decisions, you might want to have an in-house HR professional or a dedicated business partner who handles everything. However, if you are running a large operation and need to comply with more complicated laws and regulations and personalities, outsourcing is a better option.

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