March 8th, 2022

Top HR Challenges In the Food & Restaurant Industry

The food and restaurant industry has been through a lot these past two years. The pandemic has caused novel challenges from supply delays to food shortages to capacity restrictions and consumer demand fluctuations. Despite it all, the food and restaurant industry is making a comeback. But that doesn’t mean it’s not without its usual HR challenges. 

In fact, the pandemic has heightened some of the challenges food and restaurant businesses were already dealing with. To help, here are the top three HR challenges facing this industry, and ways to overcome them. 

Top 3 HR Challenges In the Food & Restaurant Industry

1. Hiring & Retaining Workers

Food and restaurant businesses require many customer service-oriented roles. And everyone knows, customer service jobs are tough. They require patience, emotional strength, and a special kind of person to last in them. As a result, this industry has a high rate of turnover. 

According to the National Restaurant Association, restaurant industry employees were down a million in 2021 from pre-pandemic levels. Challenges with hiring and retention were certainly caused by the pandemic due to shutdowns and fear of contracting COVID-19, but this industry has always had a high rate of turnover because it’s tough. The food and restaurant industry requires long hours, physical labor, and emotional stress. So many jobs in this space end up being short-term until the next best thing comes along. 

There are many strategies small businesses can consider to keep employees from quitting. But the most impactful way food and restaurant businesses can hire and retain workers is to offer new or better benefits. 

  • Healthcare insurance, retirement options, and paid time off for part-time and full-time employees are being added and advertised on restaurants hiring pages 
  • The Colorado Restaurant Association found one in four restaurants even added retention or signing bonuses in 2021 
  • Many businesses in this industry have also changed their business hours and practices to create more flexibility and work-life balance for their employees

Offering benefits come at a cost to food and restaurant owners. But if businesses can adjust their prices to make it work, many will have an easier time finding and keeping workers. Now once you hire employees, the next HR challenge becomes training and development. 

2. Training & Development

You might have recognized the employees in the food and restaurant industry are young. That’s because these businesses usually hire people without experience—especially now when the job market is so competitive—young workers may be the only ones available. 

With a lack of job experience, training and development of food and restaurant workers are a top HR challenge. These businesses require OSHA compliance training of safety and hygiene protocols on top of HR compliance training, such as workplace harassment and discrimination training. 

To properly train and develop employees, food and restaurant businesses need tools such as employee handbooks, onboarding processes, and training platforms. These resources may come at a cost, but the investment can improve the efficiency of training and increase successful outcomes with employees. 

3. Compliance with Labor Laws

According to the U.S. Small Business Administration, restaurants account for 20% of all small businesses—one of the top small business industries. With the number of people they employ, food and restaurant businesses have to deal with complex labor laws, especially in the state of Colorado. 

OSHA regulations combined with labor laws mean restaurants are dealing with double the compliance challenges as other small businesses. One compliance area that causes lots of headaches is payroll. Multiple classifications of employees and tips put restaurants at risk of violating the Fair Labor Standards Act. But there are more laws and regulations to contend with than this. 

To avoid compliance issues, food and restaurant businesses need more than a time and attendance tracking platform. They need HR expertise specific to risk and compliance. This is where Obsidian HR can help. 

How Obsidian HR Can Help 

Food and restaurant owners are in their trade for a reason—they’re pursuing their passion. Human resources, and other challenges they have to deal with, are not something restaurant owners signed up for. Luckily, HR is one of the easiest, most cost-effective things to outsource as a small business. 

In other words, food and restaurant businesses can address these HR challenges in a more strategic way than extra hours and effort. Obsidian HR can take much of the burden for them: 

  • Hiring and retention efforts are easier with our online platform and services—you won’t have to worry about applicant tracking, new hire paperwork, onboarding, employee handbooks, benefit plan offerings, and benefits administration
  • Employee training and development is painless with our on-demand HR and professional development courses—and our platform can track training completion and provide you with reports for compliance purposes
  • We’ll also reduce your risk by keeping you up to date and compliant with evolving employment laws and help with hiring and termination guidance and grievance and dispute resolution 

Obsidian HR can help with other HR challenges, including workers’ compensation and payroll. If you want to learn more about all the activities we support and how we can help you, download the guide below.

Download Our Guide: 7 HR Activities Business Owners Should Let Go of

Check out 7 HR activities to let go of to reclaim time while ensuring your business runs smoothly.

download link