The Cheesecake Factory has furloughed about 41,000 hourly workers and reduced the pay of corporate employees by 10% to 20%, the casual-restaurant operator said in a securities filing.
Company executives, including CEO David Overton, have volunteered to cut their base salaries by 20% as of April 1, the document shows. Members of the company’s board of directors have opted to cut their fees by the same amount.
Benefits, including health insurance, will be maintained for the furloughed employees until June 1. The discharged workers will also be provided with a daily meal from the restaurant where they formerly worked.
The filing indicates that the operator of 294 restaurants is negotiating with its landlords to defer or reduce rent payments for the duration of the COVID-19 crisis. The landowners have already been alerted that Cheesecake does not intend to pay April rents on all of its restaurants.
The measures are intended to reduce the company’s costs as it contends with a drop in sales from the closing of its dining rooms and an undisclosed number of restaurants. The operator says in the filing that the closures were imposed by landlords.