Chef, are you getting what you should?
I’ve chatted with a number of executive chefs, head chefs and sous chefs about their employment agreements.
I hear complaints about not getting what they thought they’d get or what they told they would get.
Here’s some case studies and what could have been done to make it better for the employee.
Handshake, but no paper
A sous chef was told he'd be on a certain starting salary for six months, after which he'd get bumped to a higher salary. He was told the usual story: it's a new restaurant, things are tight in the early days. The sous and the head chef owner shook on it.
After seven months, the sous asked his boss about the pay rise. The boss denied having made that deal and said that the pay rise would only come once the business was profitable.
At best, there would have been a drawn out 'he said, she said' dispute to determine whose recollection was correct.
Get the deal written down.
Discretionary bonus means no bonus
An executive chef's written employment agreement said he'd get a bonus based on profit - up to 20% of profit each year. The bonus structure was built into a written employment agreement.
The bonus was a 'discretionary performance based bonus subject to the following KPIs being achieved' and listed food cost and labour cost as KPIs.
The big warning flag is the word 'discretionary'. It meant the employer had the discretion not to pay any bonus.
Get rid of discretion.
Do the work now and determine the KPIs to be achieved, any sliding scales for the bonus and timing of the payment.
Promised a share in the company
This one was a senior restaurant manager. To convince the manager to stay, the owner offered shares in the company. That's ownership. That usually gives dividends (once the company is turning a profit) and a share in the proceeds of sale of the business.
A while later, the manager obtained a company extract of the company from ASIC and discovered that she wasn't listed as a shareholder.
The agreement was never documented. The employer (incidentally, the owner of the company) later said that that wasn't what was agreed to.
Ask for confirmation that you've been made a shareholder.
A head chef's written employment agreement said he'd get a share of the profit of the business.
At the end of the financial year, chef asked about the profit of the business. The owner said it was a bad year and the business didn't turn a profit. Chef was surprised as the business seemed busy most nights and the food and wage costs were good.
Chef asked to look at the books of the business to verify. At first, the owner refused. Chef never knew whether the owner was telling the truth about the profit.
If there's profit share, get an entitlement to see the books as part of the deal.
A long time between drinks
This one's a doozy: a discretionary bonus, to be calculated at the end of each financial year.
At the end of the first financial year, the chef was told there was no profit. At the end of the second, the bonus was a couple of hundred dollars.
Particularly for discretionary bonuses, have them calculated and paid frequently, perhaps quarterly.
You'll discover sooner whether the owner exercises the discretion in a way you can accept.
Is this you? Time to get it fixed.
These problems normally come from a deal on a handshake (but not in writing) or where the employer keeps a big discretion.
If your situation looks like any of these: Get in touch. Let us check what you have and whether you’re getting what you should.
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