Should restaurant staff get annual raises?

restaurant staff
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I have a cook who has been with me over a year. He asked for his “annual raise,” and I told him I couldn’t do it. He said he was offered $1.50 per hour more somewhere else. He functions when he absolutely has to, but he’s also lazy, doesn’t clean and complains a lot. I don’t like offering people more money just to stay and continue to be mediocre. Do raises every year happen in most places?

– Owner


Given the high cost of turnover and increasing challenges of maintaining adequate staffing, many operations do build in incremental raises for line-level staff, often every six months or so, maybe with some larger annual bumps. There is usually language around those raises, however, that it is also based on continued good performance. While there may be a cultural expectation that you follow this practice, given what your local competitors do or what employees have experienced in other jobs, there is certainly no obligation for you to do so. The only exceptions would be if your employees have a collective bargaining agreement or if you have such a policy spelled out in your employee manual. 

As we often see in this column, this problem is one of divergent expectations: You expect to reward good workers with merit raises as appropriate; your employee expects some sort of longevity bonus simply for putting his time in.

The solution to this problem, as usual, is clarifying expectations: “Here are the performance standards you need to meet to get a raise, with or without a certain amount of time on the job.” Spell that out in your employee manual and discuss it with your staff individually in periodic review sessions. If cleaning is a problem, be clear that he needs to improve in that area in order to see the reward he’s expecting.

There may be a way to turn this around to motivate this cook into the kind of employee you are hoping for. But in my experience, once the employee is looking for better offers, they have already mentally moved on. He may be tempted to stay because you’re a known entity and he has the job down. But in this case, my advice is to encourage him to take the better offer.

While you may not be able to repair that individual situation, you can better outline your raise and promotion policy for employees moving forward to make sure that their incentives are tied to your expectations for their performance and not simply to the calendar.

As always, check with your attorney and restaurant association to be sure you’re compliant with the laws and regulations. 

More on employee compensation here.

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