Why Your Small Restaurant Needs HR

Having HR in a restaurant can contribute to a healthy work environment and support effective hiring that leads to higher employee retention.

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While it may not be necessary or realistic for small restaurants to have an in-house human resources team, there are many reasons that small restaurants benefit from HR services. Having HR in a restaurant can help create a healthy work environment and support an effective hiring and onboarding process that leads to higher employee retention.

HR typically handles a wide variety of tasks including, hiring, firing, onboarding, resolving employee disputes, payroll, and more and it’s pretty much a given in most industries that when a business gets to a certain size (say, five or more employees) that it will need an HR team to help it succeed. While larger chain restaurants typically have HR departments, small and independently owned restaurants often have managers or owners handling HR responsibilities. The reason is likely due to a belief that hiring a separate HR manager or internal team is simply too expensive or that there is nothing HR could do to increase employee retention anyway.

There are actually many reasons why your small restaurant needs HR, even if restaurants haven’t traditionally invested a lot in HR. The good news is that there is an affordable alternative to hiring an internal team; many restaurants are turning to HR outsourcing with a Professional Employer Organization (PEO) because they get expert HR support at a lower price.

Why Your Small Restaurant Needs HR

The restaurant industry has always had a higher turnover rate than other industries, possibly in part because of the industry’s relatively low investment in HR. Without HR, restaurant owners may end up spending considerably more than they need to on hiring and training because of high employee turnover. Having an HR expert working with a restaurant can lead to happier employees who feel their need for job security and opportunities is being met, which decreases turnover.

Here are several reasons your small restaurant needs HR:

1. Managing the recruiting, hiring and onboarding process

When you have an HR team they will manage the recruiting, hiring, and onboarding process from writing job descriptions to advertising, interviewing, and processing onboarding paperwork. This frees up other managers and owners to run the business.

2. Handling orientation and training

If you want employees to feel welcome and succeed at their job, it’s important to provide effective orientation and training, including communicating your restaurant service standards and guidelines. HR is best suited to handle this work.

3. Mediating workplace issues and conflicts

It’s somewhat inevitable that when you have employees some conflicts may arise from time to time. HR can help the parties navigate their conflict and work to come up with a fair resolution.

4. Terminating employees as needed

No one enjoys firing people but someone’s gotta do it. HR professionals are trained in how to terminate employees, including creating a paper trail of warnings or issues that led to the firing.

5. Supporting employees through promotions

The HR team can help with promotions in several ways from making recommendations for who to interview, handling interviews, negotiating pay increases, and providing any training that is needed. HR can also provide professional development and training programs to help get employees ready for advancement.

6. Helping with scheduling

Anyone who owns a restaurant knows the headaches of scheduling. Restaurant schedules are complicated because they don’t run on regular office hours, but rather shifts, to ensure that the restaurant is properly staffed during both peak and quiet times. An HR manager can help with employee scheduling needs, which can save the scheduling manager the headache of having to re-work the schedule after it’s already done.

7. Managing payroll

HR experts can manage payroll; taking an enormous burden off of business owners or general managers. In addition to the task of identifying individual hourly rates, HR keeps track of Hawaii payroll laws, ensuring that overtime laws and minimum wage laws, etc. are followed to a T so you can avoid employee lawsuits.

Why outsource your restaurant HR needs

There are many reasons to outsource your restaurant HR needs rather than hiring an internal team:

  • Often more affordable, especially for smaller restaurants
  • Outsource tedious and repetitive tasks that slow you down from running the business
  • Outsourced industry experts don’t require industry-specific training

Whether you choose to hire an in-house manager or outsource your HR needs, having HR on board at your restaurant is your best chance at creating a positive work environment where employees want to stick around long-term. Without a doubt, lower turnover means saving money.

Partnering with Makai HR

Need help with HR? We’ve got you covered through HR outsourcing! When you partner with Makai HR you can get on with the business you are trying to grow while we take care of your employee needs from payroll to taxes, health insurance/benefits and worker’s compensation. You also gain peace of mind that you are compliant with all of Hawaii’s employer laws (if you’ve ever looked you know that the list is very long and changes happen). When choosing a PEO to partner with, there are many things to consider including cost, services, and technology solutions. 

With the cost of doing business in Hawaii at record highs, we know how important it is to keep labor costs in line with revenue. Our plans are priced competitively and include value-added services like time-in/time-out systems. Our three tiers of PEO service plans are tailored to the size of your business and specific needs. We offer a 100% paperless solution which means that your employees can manage their needs through a computer, tablet, or phone. We can truly improve your employees’ work benefits while freeing you up to run your business.

What are you waiting for? Companies that partner with a PEO benefit from 7-9% faster growth, 10-14% lower employee turnover; and they are 50% less likely to go out of business. Contact us today to get started!

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