WHY RESTAURANTS NEED HR MORE THAN EVER

Having HR in restaurants of all sizes can aid in creating a better work environment and save money on the hiring and onboarding process.

The human resources department is a vital resource for any high-functioning business. For the majority of industries, having an HR department is a requirement for success — a necessary component of any business with more than a handful of employees. The range of responsibilities assigned to an HR team varies from business to business, but is often vast and embodies everything from recruiting to onboarding, hiring to terminating and much more in between. So, if HR is such a necessary element, why do so few restaurants have HR?

For independent restaurants, creating an entire HR department from scratch can seem a bit over the top, but the fact is, even having just one person dedicated to human resources in a restaurant can lead to happier employees who continuously learn and grow on the job, and stay with their company for the long term. Think of how much time and money you spend each year hiring and replacing your restaurant employees, rearranging schedules to cover for interviews, bending employee responsibilities to cover the onboarding and training process in your restaurant, and ensuring wages are in line with the industry’s collective agreement. Having HR in place is simply a proactive approach to employee retention.

What is the cost of staff turnover for restaurants?

Just because restaurants don’t typically have HR departments doesn’t mean that it’s a sustainable business strategy. Think about the benefits of HR for restaurants that are growing or looking to expand — when you have multiple locations to manage, your number of employees grows quickly. With an HR person or team designed to oversee and juggle their needs, a lot of responsibility is taken off of the plate of the Owner, General Manager, and assistant General Manager, allowing for even more growth and time to focus on managing the business.

Yes, having HR at your restaurant is an investment. And yes, it is an investment worth making, and one that will pay for itself in a short amount of time.

Why don’t more restaurants have HR departments?

I know what you’re thinking: if the majority of restaurants don’t have HR departments then it can’t be that necessary. The truth is, HR departments are not seen as frequently in the restaurant world as in other industries because up until quite recently, it wasn’t seen as a traditional “industry”. For a long time, most restaurants didn’t provide their employees with any means of stability — no restaurant benefits, no wage increases, limited protections for workers.

Of course, this lack of structure and employee protection had the potential to put restaurant employees at risk. Without benefits or tangible job security, many restaurant employees felt unimportant, when in reality all of them are essential to the success of restaurants of all sizes.

Simply put, HR keeps restaurant employees feeling secure, in addition to easing the employee management burden on Owners and General Managers. To invoke industry-wide change takes an organised effort — and one of the first steps you can take toward progress is appointing HR for your restaurant.

Why you should consider appointing HR for your Restaurant

If you’re not yet sold on the importance of appointing HR at your restaurant, let’s explore a little further into the many perks and benefits of having an HR department.

1. HR will help to source, appoint, and on-board new employees

In 2019 the annual restaurant staff turnover rate reached the highest of any industry. Additionally, COVID-19 introduced an entirely new fleet of unforeseen obstacles to the restaurant industry, resulting in thousands of jobs lost in the hospitality sector. While there has been an incremental increase in job creation over the last 5 months, the turnover rate in the restaurant industry will likely see high rates in the coming years as we hoist ourselves back up to our full potential post-pandemic.

With HR, you have a resource dedicated to the recruiting, hiring, and onboarding process, as well as employee relations and morale. If you’ve ever led recruitment and onboarding efforts, you know how tasking the job can be. It frequently entails:

• Creating job descriptions
• Advertising job openings
• Conducting interviews
• Processing onboarding paperwork
• Creating and teaching orientation
• Training hires on workplace policies
• Communicating restaurant service standards and guidelines
• Fostering employee engagement
• Mediating workplace issues or conflicts
• Handling terminations of restaurant employees and delicate conversations

While these responsibilities are standard for HR in any industry, for the restaurant industry HR members also serve as industry professionals in order to network well to recruit the best candidates for the job. Without a dedicated recruiting, hiring, and labour law resource, restaurants are left with loading all of these responsibilities onto the General Manager, or passing it on to the Assistant General Managers and Shift Managers. They have to carry out these duties on top of their already busy schedules. With limited time and little to no experience in HR practices their efforts could lead to bad hires and weak people management practices resulting in to high staff turnover and operational hiccups.

2. To facilitate discussions when problems arise between employees

When people think of the responsibilities of HR, many of them jump right to picturing them as problem solvers and mediators. While I know that their responsibilities are much more involved than breaking up arguments here and there, it is true that when interpersonal problems arise in the workplace, an HR member is able to step in and help all parties navigate the conflict.

Having HR with the ultimate goal of acting as mediator means that when problems arise, there is a go-to source for problem solving. Otherwise, the problem has the potential to quickly get out of hand and become unmanageable, or result in an employee’s resignation, leading you to need more staff and having someone with an unhappy experience who will be a negative referral.

When employees don’t have a trusted source they can turn to and confide in when things get tough, they might inappropriately jump rank to bring a small issue straight to a higher-up, begin spreading misinformation to their fellow employees, or worse — feel as though their voice isn’t being heard at all.

3. To advocate for employee needs

HR is should also be a resource for employees. In regards to many different workplace topics, HR is normally who employees go to first. When companies don’t have an HR, senior management is left responsible for both the day to day grievances of employees, as well as long term grievances and more serious issues like sexual harassment.

Helping employees thrive in and out of the workplace is an essential function of HR and managing employee relations can oftentimes feel like a full-time job in and of itself, especially for businesses that are growing. Having dedicated HR on hand is essential to improving overall company culture. HR may find themselves advocating for employees needs that include:

• Supporting employees as their career grows within the business
• Training managers
• Supporting employees by providing them with information and resources concerning both physical and mental health
• Communicating the intricacies of their employment terms and conditions
• Providing professional development and training programs

4. To help with payroll

Payroll management is a headache. Of course, not all HR representatives are tasked with managing payroll and not all businesses require their HR to oversee this field, but this is where the delegation comes in.

Balancing the payday of staff, covering expenses that need to be reimbursed, navigating raises and bonuses — all of this and more being managed by a single person can very quickly be an overload. It is important to not overwhelm your employees, especially those dealing in delicate matters such as payroll. Instead, delegate a payroll managerial responsibility or two to your HR or outsource the function altogether. This way, you can avoid the headache altogether by spreading the burden out into more easily managed, lighter loads to carry.

5. Outsourcing HR to a Restaurant HR Service

If you read this whole guide on why you should create an HR team at your restaurant and feel like it would be too massive of an undertaking, we have some good news for you: You can outsource HR to a restaurant HR service.

Once you choose to integrate HR services at your restaurant, you get to decide whether or not to build an in-house team (or individual!) or outsource your HR needs to a third-party service. Whichever you choose will depend on the specific needs of your restaurant and employees, but to make the decision a little easier for you to make, let’s run through the pros of outsourcing HR.

Why not outsource your Restaurant HR?

Hiring outsourced HR services is often less expensive than building an internal HR department from scratch, especially for smaller restaurants.

If you have a single in-house HR representative, you can use them for the more tedious or repetitive tasks and outsource an HR representative for more strategic, personal responsibilities.

Restaurant HR requires experience — it may be easier to hire an outsourced industry expert than it is to hire someone who requires industry-specific training.

The bottom line is that when you incorporate a human resources team into your restaurant you are actively choosing to make your restaurant a happier, more inclusive professional environment where employees will be more likely to work for the long run. This, in turn, saves your restaurant money and contributes to a better work environment overall.

If there is something I want you to know about me right away, it’s that I have a passion for supporting business owners. I believe in the future of South Africa and that there are so many opportunities out there to be successful and to make a change to our economy.

I want to be part of that change by providing businesses with core HR and Labour Solutions that will not only result in legislative compliance but actually positively impact their bottom line.

Over the years I have gained practical HR experience working in various sectors such as mining, construction, financial services, and corporate legal. As a business owner myself, I can relate well to businesses and what their needs are.