The Burger Chain That Pays $10 An Hour With Benefits

[ProSense]

The Burger Chain That Pays $10 An Hour With Benefits

By Bryce Covert

Shake Shack, a burger chain with locations in Florida, New Jersey, New York, Pennsylvania, Washington, D.C. as well as international locations in the Middle East, Russia, Turkey, and the United Kingdom, pays starting workers $9.50 an hour outside of New York City and $10 an hour for New Yorkers, CEO Randy Garutti told ThinkProgress. It also offers full-time employees health, dental, vision, retirement, and disability benefits plus paid time off.

But on average, workers get $10.70 an hour thanks to a program it calls Shack Bucks. Every month, it gives employees a percentage of the company’s top-line sales. “It’s sort of immediate revenue sharing, not a long-term program,” he noted.

The company pays about 70 percent of employees’ health care premiums and also matches contributions to their 401(k)s. He added that he is “more excited” than all of these perks about how many employees move up into manager roles. “There are a lot of people who started making $9 an hour and are now general managers in our restaurants making very good money,” he said. The owners started in fine dining and brought the compensation practices from those restaurants into its original burger and hot dog stand.

When asked if these practices have come with concrete benefits for the company itself, he responded, “Absolutely,” adding, “Our turnover is lower, we can hire the best, they stay longer, and we can grow them into management.” And it pays off for customers. “If the team feels taken care of, then they’ll go out and take care of the guests.”

- more -

http://thinkprogress.org/economy/2014/03/21/3417056/shake-shack-wages-benefits/

[KansDem]

1. It can be done...

The old "If we pay workers more we'll just have to pass that cost on to consumers" argument has been horseshit for several decades now.

Along with the old "we welcome competition because it keeps prices low and quality high" crapola.

[thesquanderer]

7. They do charge their customers more, though

From the huffingonton post article about this:

The downside is that Shake Shack also charges more than your typical fast food restaurant. A Double ShackBurger with fries and a soda will set you back about $12.20 at the restaurant's Upper East Side location. At an Upper East Side McDonald's, a Big Mac Value Meal, which consists of a double burger, fries and a soda, costs only $6.69, according to Delivery.com.

http://www.huffingtonpost.com/2014/03/21/shake-shack-pay-workers_n_5006580.html

Luckily, it's worth it!

Some of the price difference is just that it's better food (I think most people would agree). And some of it is probably higher labor overhead. And I assume some is likely higher profit margin for the ownership as well.

[Omaha Steve]

2. We need one of this in the Omaha metro area

Marta and I would support it.

Thanks for the post. K&R!

OS

[oldandhappy]

3. Wish I lived close enough to patronize this chain.

Good for them!!

[Bluenorthwest]

4. Oregon minimum wage is currently 9.30 an hour, so outside NYC they pay a bit over

that which everyone pays here. I love Shake Shack, support their use of higher wages on the East Coast where such things are rare. This explains the great service there.

[KamaAina]

12. San Jose's is $10. SF's is $10.55.

Shake Shack would do very well in SF.

[frazzled]

5. And that serves wine

not to mention an ale specially brewed for them by Brooklyn Brewery. And Woof treats for your dog.

I think it's great that they're paying help $10. But Shake Shack is not exactly McDonald's, either (thank goodness!).
That said, McDonald's could do this.

[KamaAina]

13. McDonald's does do this

in cities such as San Jose, SF and Albuquerque which have set higher minimum wages than those of the states they are in. The McD's down the street from my office does not appear to be suffering in any way.

[CrispyQ]

6. Smart man.

AWhen asked if these practices have come with concrete benefits for the company itself, he responded, “Absolutely,” adding, “Our turnover is lower, we can hire the best, they stay longer, and we can grow them into management.” And it pays off for customers. “If the team feels taken care of, then they’ll go out and take care of the guests.”

[bullsnarfle]

8. Remember when

there used to be such a thing, especially in the business realm, called "enlightened self-interest"? These Shake Shack folks seem to grok it.

Corporations now are killing the geese (mostly middle class) that used to lay their golden eggs, and they either don't know (comprehend) it, don't give a damn, or both.

[Z_California]

9. Funny how that works

Best burger place on the West Coast, In N Out, starts employees at $11/hour with benefits. Privately owned and a gold mine.

[cui bono]

14. That was the burger joint I thought of when I read the headline.

Didn't know they paid that though. Good for them.

[gort]

10. Seattle Burger Chain has been doing this for years

http://www.ddir.com/employment

They are also famous for their hand packed ice cream "Dick's Shake". Has made many a drunk or stoned college aged kid snicker in delight since 1954.

[Stuart G]

11. K and R thanks for posting..no text..

[Cha]

15. So true and sweet.. it makes me all

Verklempt!

thank you, PS