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Vaccine mandates are causing ‘significant challenges’ for Sweetgreen

The fast casual, which submitted its go-public plans this week, said it is having trouble getting workers to submit proof of vaccination, which could lead to layoffs, staffing shortages and potential restaurant closures.
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For Sweetgreen, the pandemic is doing more than just slowing sales by keeping big city office workers from their lunch salads. COVID vaccine mandates are wreaking havoc on the fast casual’s workforce.

The chain said in its go-public documents this week that it is having “significant challenges” getting workers to submit proof of vaccination, which could lead to widespread layoffs, staffing shortages and potential restaurant closures.

“To date, we have had significant challenges with our team members submitting proof of COVID-19 vaccinations,” the 140-unit chain said in its S-1 documents. “If the Biden employer vaccination mandate goes into effect, or if we choose to continue to operate indoor dining in markets with indoor dining vaccination mandates, the required actions could result in potentially significant employee layoffs, staffing shortages and related restaurant closures …”

Early last month, Pres. Biden announced that all companies employing at least 100 workers would need to ensure that all are vaccinated or provide weekly negative COVID tests. The White House has not said when those regulations might be put in place.

A year ago, Sweetgreen said it laid off 20% of its corporate staff to deal with ongoing fallout from the pandemic as many of its restaurants in dense urban areas continue to try to recover from the slow return of office workers. Last year, the chain also temporarily furloughed about 2,000 of its workers for up to 90 days, it said in its filing.

“The COVID-19 pandemic may also adversely affect our ability to implement our growth plans, recruit new team members, and cause delays in construction, permitting or opening of new restaurants, as well as have an adverse impact on our overall ability to successfully execute our plans to enter into new markets,” Sweetgreen warned.

Being forced to check the vaccination status of dine-in customers could also lead to “customer frustration and increased labor costs,” the chain noted.

Sweetgreen said its same-store sales fell 26% in 2020, with losses of $142 million. This year, the salad chain’s same-store sales are up 21%, with $87 million in losses.

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