HR Still Matters- for managers

Your Menu for Attracting and Retaining Young Employees

About Us The Industry-Education Council of Hamilton (IEC) is a not-for-profit organization devoted to advancing cooperation between business, education and government and championing innovative programs and services that help young people understand the world of work.

For more information, contact us: IEC Hamilton 225 King William Street, Suite 203 Hamilton, ON L8R 1B1  905 529 4483  info@iechamilton.ca  www.iechamilton.ca

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s a restaurant manager, you probably hear a lot about the turnover rate in your industry. Chances are you’ve already experienced the cost of losing and replacing a valuable employee. You understand that recruiting a new person involves more than interviewing candidates and offering them the job.

Finding the right person with the right attitude and skills can be a time consuming task, particularly in your sector, which is a ‘people business’. Hiring is also associated with training and orientation costs, not to mention dealing with your regular customers, who might be unhappy that their favourite server or cook is no longer around!

Happy employees are the backbone of all good businesses.

While you want to make all your employees happy, you may need to pay particular attention to your young employees.

Why? Because, your industry is the second largest employer of youth in Canada. Investing in attracting and retaining young people is, therefore, a smart move; especially considering the labor shortage that is expected to hit your sector in the near future.

The question is ‘how do you do it?’ To find some answers that work in our local context, to understand the turnover issue in Hamilton and to identify best practices in attracting and retaining young employees, we’ve conducted a study entitled ‘HR Still Matters: Targeting the Turnover in the Restaurant Industry’. Hamilton based casual and family dining restaurants participated in this study. Twenty-five managers and eighty-eight employees under the age of 26 responded to the survey.

By analyzing the results of our survey in light of commonly cited strategies for staff retention, we’ve prepared this handbook for you as an employee retention guide. The handbook provides you with some tips that will help you in attracting and keeping your young employees, who are the base of your future workforce.

Enjoy reading and if you have comments, contact us at info@iechamilton.ca 1

Did you Know….? 

The average annual turnover rate for an hourly paid employee is 104.8% at a fast-food restaurant and 62.5% at a sit-in, family dining restaurant. (Canadian Restaurant and Foodservice Association)



While some involuntary departures (due to theft, poor performance etc.) are “healthy,” voluntary turnover is by far the most common and represents 83% of employee departures.

(Canadian Food Industry Council)

The Good News Turnover in the twenty-five Hamilton restaurants surveyed is unusually low compared to national sector research. However, the turnover rate is higher among young employees. 58% of the managers said they are concerned about the high turnover among their young employees.

Turnover Rate

Under 10%

10% to 25%

26% to 39%

40% or more

Employees as a whole

84%

12%

0%

4%

Young employees (under 26)

58%

33%

4%

4%

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Did you Know….?

The cost of losing and replacing an employee can cost up to 18 months’ salary for a manager or professional and 6 months’ salary for an hourly worker, according to a research cited by The go2 Tourism HR Society.

To calculate your employee turnover cost, go to http:// cghrc.ca/en/employers/recruit-retain-resources/ turnover-cost-calculator

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Recruit the right candidate Recruiting the right candidate reduces turnover later and provides better service for your customers.

Survey Says…

The majority of the restaurants surveyed don’t have a recruiting strategy that targets youth.

What this means to you...

41% of the employees of the restaurants surveyed are under the age of 26. This shows that a youth-friendly recruiting strategy is necessary.

What should you do?  Choose youth friendly places (like facebook) to post your vacancy ads.  Use the network of your current young employees to find new recruits.  Connect with your local youth employment agencies and have your posting available on youth friendly job sites.  Make sure the wording of recruitment ads reflects your corporate culture and values and appeals to the interests of your ideal candidate.  Develop complete and detailed job descriptions. These will help candidates determine in advance whether the job is right for them.  Train your interviewers in youth friendly interview techniques.

4

Create a positive work environment Build a team that gets along with each other and ensure that your employees feel respected and recognized for the good work they do.

Survey Says…  65% of the young people we surveyed said that a good relationship with their managers and co-workers plays a key role in keeping them happy at work.  Whether it is given individually or in team, 85% of them indicate that they need regular feedback.  While 40% of the restaurants implement employee recognition informally, only 32% have a formal recognition system.

What this means to you...

Good Business

Good communication with supervisors, engagement with the workplace team and appreciation for work completed are important.

Happy Employees

What should you do?        

Recognize good work in formal and informal ways.

Give constructive feedback and praise good work in front of peers.

Provide mechanisms for employees to identify problems and resolve conflicts.

Share information about the business.

Hold regular staff meetings and communicate the work that needs to be done.

Ask employees for input before making changes that affect them.

Create an employee newsletter for news and workplace culture.

Train managers in performance coaching.

5

Show interest in their future career plan Strong employees often want to learn more, increase their responsibility and move up in the organization. If they don’t see advancement, they will leave.

Survey Says…

In most of the restaurants we surveyed, there isn’t a formal system that indicates how employees can progress and move up. 72% of the managers reported that they handle advancement informally.

What this means to you…

A strategy is necessary to give employees a clear idea of the advancement/ progression system. This will encourage your employees to be focused and plan their career path within your restaurant.

What should you do?  Clearly outline the path up the ladder.  If you can’t promote them upwards, look laterally: are there other opportunities for growth before the next promotion is available?  Consider subsidizing continuing education that helps employees increase their qualifications for internal promotion.  Develop mentoring or peer advisor programs.  Promote from within as much as possible.

6

Train and mentor your young employees Ongoing staff orientation, training and development are some of the most important investments you can make in staff retention.

Survey Says…

Training seems to be formalized at the beginning and less of a focus later. 89% of the young employees said they have received training for the job they are doing, but only 59% rated this training as being really useful. Mentoring or buddy systems exist (52% of the restaurants implement mentoring formally), but have room for growth.

What this means to you…

The Canadian Food Industry Council lists limited training time as one of the most influential management practices that increase employee turnover. Continuous and meaningful training will help your young workers to perform better. Use your experienced employees to mentor the young and inexperienced ones.

What should you do?  Increase your focus on training.  Create individualized training plans as part of an employee’s annual performance review process.  Establish a mentorship system.

Mentoring brings value to everyone involved in its practice.  Mentees have an opportunity to learn from someone who has experience.  Mentors have an opportunity to pass their knowledge to the next generation.  Employers have an opportunity to costeffectively train their workforce.

7

Review your pay policy Make sure your pay policies are equitable and competitive.

Survey Says…

70.3% of the young employees rated ‘better pay’ as a factor that will encourage them to stay in their current job. Only 8% of the managers have a formal system that compares wages with similar restaurants to stay competitive.

What this means to you…

If your pay isn’t competitive, your valuable employees might decide to leave.

What should you do?  Review your pay practices regularly.  Consider all possible aspects of a pay package: base pay (hourly wage), performance-based pay (bonuses), equity-based compensation (RSP contributions, stock offerings), benefits packages (sick time, health coverage, financial planning, paid training etc.) and reward/recognition programs (like extra time off, learning opportunities, bonuses.)  Reward good employees with a raise – even a small increase will help keep them.

8

Motivate, Motivate, Motivate Incentives might not make an employee who is leaving for better pay stay, but it sure will motivate your employees to be more productive.

Have you thought about other creative ways of motivating your employees? Here are some suggestions. Take those that work for you and be creative:  Establish a birthday gift program. It could be an extra 30 minutes break.  Offer free meals for praising good work.  Give discount coupons that can be redeemed by the employees or their family members.  Organize a staff dinner once in a while.  Establish an ‘employee of the month’ program. Make sure you reward the winner somehow.

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Recruit the right candidate Create a positive work environment Show interest in their future career plan Train and mentor your young employees Review your pay policy Motivate, Motivate, Motivate!

Acknowledgement We thank all the restaurant managers and employees who participated in our survey. We would also like to acknowledge the following members of the advisory committee for their valuable input.  Charmaine Lefebour (Chef and Wife)  Chris Boucher (Mohawk College)  Joe Amorim (Swiss Chalet)  Murline Mallette (Liaison College)  Nancy Johnson (Johnson Associates)  Wally Stadnicki ( Employment Hamilton)