10 Biggest HR Challenges In The Food And Beverage Industry And How To Address Them

There’s no denying it - employee experience is the most important factor to a business' viability today. This is especially true in the food and beverage sector, where staff play a critical role in keeping customers happy.

It's estimated that these individuals make up more than 1.1 percent of all nonfarm employment in the United States, totaling roughly 1.7 million people as of 2021^[1]. Their experience is paramount to the success of an operation - Human Resources departments know this, yet they still have to tackle a unique set of challenges.

This article will break down 10 of the unique HR problems faced by employers in the food and beverage sector as well as provide tips on how they can be addressed.

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10 Common HR Challenges In the Food and Beverage Business

The food and beverage industry is no different from every other business sector in America in that it faces Human Resources related challenges. Only its problems are specific to the kind of work employees do on a day-to-day basis. See a list of the 10 most common below.

1. Shift Management

Most businesses in the food and beverage industry run on all-day everyday schedules to accommodate the ongoing needs of their customers. They operate beyond the nine-to-five, necessitating different shifts of staff to cover all the hours. This presents a challenge in maintaining continuity with staff and ensuring fairness in shift rotations.

2. Compliance With Labor Laws

Every business in America, whether in the dining or accounting sector, must adhere to national, state, and local-level labor laws. Legislation like the Fair Labor Standards Act of 1938, and of course, all subsequent revisions must be taken into consideration when managing employees. Food and beverage companies tend to face greater circumstantial exposure to labor laws, such as overtime and wage changes.

3. Employee Onboarding and Training

A proper onboarding and training process is critical to ensuring new employees are prepared for the unexpected things a day at work will throw at them. Yet, it's something that many food and beverage businesses fail to prioritize. This has both short-term and long-term implications; staff have a harder time thriving in their roles, while those who struggle are more likely to leave their job altogether.

4. Payroll

HR managers have their work cut out for them with respect to food and beverage employee payroll. There are multiple streams of income to factor in - such as Regular wages, Paid Time Off (PTO), and tips - not to mention company-specific policies that dictate how staff earnings should be divided among team members.

5. Workplace Safety

The safety of employees and customers is a top concern for food and beverage companies. Rigorous sanitization protocols, proper equipment maintenance, ergonomic workstations, and protective gear are all essential to running a safe operation. Still, the U.S. Bureau of Labor Statistics reports^[2] that workers in the special food services industry experience much higher rates of occupational injury and illness compared to their counterparts - 107.6 per 10,000 full-time employees in 2017.

6. Injury, Damage and Theft Prevention

In an environment as busy as that of a pub, club, or restaurant, incidents are bound to happen. People slip and fall, things get broken, and in the worst of cases, employees might even decide to steal company property. HR managers often struggle to find a way of corralling all of these risks into a single, comprehensive policy.

7. Employee Retention

Food and beverage employees are among the most overworked professionals in the labor market, facing long shifts, high standards, and challenging customers every single day. As such, few stick around for long - the Bureau of Labor Statistics reported an average annual turnover rate of 75% in 2019^[3]. Things have only gotten harder since for workers as they continue to adapt to the lasting changes made by COVID-19.

8. Compensation

Although it's a pursuit of passion for some, a large majority of bartenders, servers, and kitchen staff view their jobs as a means to an end. Naturally, these employees are looking for a fair wage that can support their lifestyle and help them reach their financial goals. Meanwhile, employers in the food and beverage industry tend to pay wages much lower than those of other sectors - at a median rate of $13.52 an hour^[4] in May 2022.

9. Staff Morale

Many of the abovementioned challenges culminate to impact team morale. It's a hard thing to maintain in any busy, high-demand industry, let alone one that sees frequent employee departures, customer service disputes, and extended working hours. Poor morale is is not self-contained - it can spread quickly among staff, leading to an even worse atmosphere that proliferates multiple problems.

10. Recruiting

While a career in the food and beverage sector can be very enjoyable and rewarding, not everyone sees things that way. Restaurant owners often have trouble finding qualified talent, and also face heightened competition from industry counterparts who are looking for the same thing.

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How to Navigate HR Challenges In the Food and Beverage Sector

While the 10 HR challenges in food and beverage companies we just listed seem daunting, rest assured that they aren't without solutions. Here are a few best practices any employer can take to improve the vitality of their workforce:

Develop a Comprehensive Training Program

No matter what level of the employee, training, and education should be prioritized in the food and beverage sector. By providing employees with comprehensive training and development programs, employers can ensure that everyone is qualified to do their jobs proficiently - minimizing potential mistakes.

Offer Incentives and Promotions

Employee incentives and promotions can help motivate staff to stay with the organization for longer periods of time, reducing turnover rates. Consider offering bonuses or other rewards for jobs well done to keep employees feeling valued and appreciated.

Automate Payroll

While manual payroll works in some industries, those in the food and beverage sector can't get away with it due to the complex nature of their business. Payroll software is a smart investment for any company that wants to ensure their staff are compensated accurately and on time, with less chaos.

The food and beverage sector is an industry that has historically had significant HR challenges. Employers must take proactive steps to ensure their employees have the resources they need to thrive. Investing in ongoing training, providing a safe working environment, and ensuring fair compensation are all key pieces of the puzzle. Ultimately, taking the first step is the most important part - from here, it's just a matter of action.

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[1] https://www.ers.usda.gov/data-products/chart-gallery/gallery/chart-detail/?chartId=106049#:~:text=Meat%20and%20poultry%20plants%20employed,of%20all%20U.S.%20nonfarm%20employment

[2] https://www.bls.gov/opub/ted/2019/injury-and-illness-rates-higher-in-special-food-services-than-in-broader-food-services-industry.htm

[3] https://www.bls.gov/news.release/jolts.t16.htm

[4] https://www.bls.gov/ooh/food-preparation-and-serving/food-and-beverage-serving-and-related-workers.htm