Are there benefits that might be particularly attractive to employees who are still in school?
Willis: One sought-after benefit that can help retain student employees is tuition reimbursement. Many employers stipulate that workers must stay employed with the company for a certain length of time to qualify, generally between 18 months and two years after receiving the reimbursement. And employees typically have to work at the company for a year before they’re eligible for the benefit.
Many employees want help with their healthcare and daycare expenses. What can owners offer?
Quinn: Restaurant firms may want to consider offering employees a health savings account, which works with eligible health insurance plans that have higher deductibles than many traditional health plans and typically lower premiums. Another valued benefit is a dependent care flexible spending account to allow workers to pay, using pre-tax dollars, for daycare, preschool summer camp, before- or after-school programs or adult care.
A retirement plan is one of the most sought-after benefits by managers and senior employees. Yet only a minority of small businesses, including restaurants, offer a 401(k) plan. Why?
Quinn: In the past, 401(k)s were not particularly attractive to restaurant owners because the plans were costly, burdensome to administer and had significant compliance requirements. But today there are many advances, such as turnkey plan designs and digital platforms, that make retirement plans simpler to administer and much less expensive. For example, a multiple employer plan, or MEP, allows many small business owners to participate in one plan. In a traditional 401(k), the employer is the fiduciary for the plan and responsible for choosing the investments, designing the features and conducting ongoing compliance testing. In an MEP, all those duties are handled by a separate plan sponsor. And depending on how many small businesses are participating in an MEP, the costs can be substantially lower than a traditional 401(k). For restaurant operators with fewer than 100 employees, a great option is a Simple IRA, to which both employees and employers can contribute.
Are there financial benefits for restaurant owners when they offer a retirement plan?
Quinn: Small business owners who offer a match to employees’ contributions get a tax deduction on the firm’s contributions. And recent legislation gives small business owners a tax credit of up to 100% of the expense for setting up and administering a plan for the first three years. Those are very strong incentives for employers to offer a retirement plan.
The restaurant workplace is one of the most diverse in the U.S. economy. According to a 2022 Department of Labor estimate, nearly half of restaurant workers are minorities. What can restaurants do to support this diverse population?
Quinn: When a restaurant creates an inclusive workplace culture, employees feel they belong, which makes them feel more engaged in their jobs and more productive. To promote a culture that values diversity, restaurants should provide diversity, equity and inclusion training to all employees and develop mentorship programs that might include language classes or computer classes to help employees advance in their jobs.