In the ever-evolving landscape of the restaurant industry, where margins are razor-thin and regulations are constantly shifting, staying ahead means arming yourself with smart strategies and expert guidance. The recent Restaurant Master Class webinar, "Managing Your Labor Costs: Strategies for Efficiency & Compliance," delivered just that. To watch the recording of the webinar, click here.
Moderated by Dustin Minton, CPA, MBA, this session brought together a powerhouse panel: Evan Priestle, a seasoned employment and labor relations attorney at Taft Stettinius & Hollister, LLP; Tod Bowen, the managing director of external affairs and government relations for the Ohio Restaurant & Hospitality Alliance; and Patrick Rogers, managing partner and CFO of Manna Development Group, LLC, a franchisee of Panera Bread and Caribou Coffee. The guests wasted no time diving into a discussion geared toward helping attendees control labor expenses, navigate labor laws, leverage labor modeling, address immigration impacts, and mitigate legal risks.
Labor costs can make or break a restaurant's profitability, and the panel emphasized proactive measures to keep them in check. Rogers shared how re-evaluating operating hours that meet your customers’ demand while balancing with the overall staffing model to be leaner and more efficient. Priestle highlighted the irreplaceable value of in-person check-ins alongside tech tools, warning against unintended pressures that lead to off-the-clock work, a recipe for wage-hour disputes. Rogers shared real-world tactics from his multi-state operations, stressing parameters like limiting early clock-ins and overtime approvals.
Key strategies discussed include:
With labor laws varying wildly from state to state (and even city to city), maintaining compliance while keeping policies fair is a high-stakes balancing act. Rogers candidly described the challenges of multi-state operations, advocating for uniform policies where possible but turning to third-party providers for flexibility when laws diverge. Priestle reinforced this, noting that a core handbook with state-specific addenda helps shield differences from employees, reducing resentment and legal exposure.
Bowen provided a governmental affairs update, spotlighting trends like predictive scheduling, which has gained traction on the West Coast but faced pushback elsewhere. Only Oregon has statewide predictive scheduling laws, while 10 states, including Ohio, ban municipalities from enacting their own. On minimum wages:
Bowen also touched on tipped wages, where attacks by groups like One Fair Wage have met resistance, with successes in maintaining tip credits (differences ranging from $1.25 to $12). Recent wins include Washington, D.C., reversing its phase-out of tipped minimums.
For smaller operators without dedicated HR, the experts urged partnering with third-party services or consultants.
"HR professionals are your best defense," Priestle asserted, emphasizing periodic check-ins and awareness of municipal-level changes that can sneak up on even the most vigilant teams.
Read Also: Webinar Recap: Navigating Food & Beverage Costs For Enhanced Profitability
The shift toward technology is reshaping labor efficiency, and the panel was optimistic about its potential, while acknowledging that we are just scratching the surface. Rogers detailed how his stores flipped from 70% dine-in to 70% takeout post-COVID, driving efficiencies through kiosks, online ordering, and third-party delivery. These changes reduced labor hours: no cashiers means saved minutes per transaction, multiplying into hours across hundreds of orders. Plus, less table service equals fewer dishes and cleaner operations.
Other key facts and figures from the discussion include:
Immigration remains a hot-button issue, with enforcement ramping up. Priestle stressed I-9 audits as the cornerstone of risk reduction, recommending third-party reviews to catch systemic errors before ICE does. Penalties can escalate quickly, so spot-checks by legal pros or third parties are wise investments. E-Verify, mandatory in some states, requires trained users to avoid red flags that invite audits.
Bowen added operator-focused tips, including distinguishing judicial from administrative warrants (the latter limits ICE's demands) and having a communication plan for raids. His alliance's new Immigration Compliance Guide, soon available online, offers plain-English advice tailored for restaurateurs.
Key practices include:
Recent legal shifts demand attention. Priestle unpacked the "One Big Beautiful Bill," focusing on no-tax-on-tips (capped at $25,000 deduction, for customarily tipped roles only) and no-tax-on-overtime (up to $12,500, for FLSA-required overtime). Bowen emphasized its operator-friendly design: no extra W-2 work, preserved Social Security credits, and protection for tip credits. Communicate these wins to staff. Tips benefit front-of-house; overtime aids back-of-house.
SCOTUS decisions include lowering the bar for "adverse employment actions" in discrimination claims (potentially increasing litigation) and equalizing proof standards for majority plaintiffs. Practically, these underscore consistent policies and robust HR.
This webinar was a call to action for restaurant leaders who are passionate about sustainability and success. By blending tech efficiencies, legal savvy, and advocacy awareness, operators can control costs without compromising culture. As Rogers put it, challenges like multi-state laws are "challenging at best," but with tools like uniform policies, third-party support, and regular education, they are navigable.
Dive into resources like the Ohio Restaurant & Hospitality Alliance's guides, schedule I-9 audits, and embrace technology's efficiencies. Your team, and your bottom line, will thank you.