Category Archives: Research & Resources

BKD Houston

Behind the Kitchen Door: Extreme Inequality and Opportunity in Houston’s Vibrant Restaurant Economy

Restaurant Opportunities Center of Houston’s latest report is the most comprehensive examination to date of the Houston-area restaurant industry, drawing on 553 worker surveys, 27 structured interviews with restaurant workers and 13 employer interviews, along with other industry and government data. The study offers a vivid picture of the state of the industry and makes recommendations to improve Houston’s economic development, public health and workplace conditions for the city’s restaurant workers.

Houston is America’s fastest-growing city and its vibrant restaurant industry has been called the “most dynamic and diverse food and drink scene in the nation.” However, research indicates that the restaurant workers whose labor makes Houston’s growth possible are being left behind. The majority of restaurant jobs in Houston remain low-road jobs defined by low wages, few benefits, and poor working conditions.

Key findings include:

  • 51% of Houston’s restaurant workers are paid an hourly wage that would not support a family of three above the poverty level. Workers also reported overtime and minimum wage violations, a lack of training, and unsafe workplaces.

  • 51.9% of restaurant workers of color earn below poverty wages, as opposed to 34.3% of white restaurant workers. White workers earn a median wage of $11.82, compared to $8.32 among workers of color.

  • Nearly all (93.1%) of surveyed workers were not offered employer-provided health insurance, and almost two-thirds (61.3%) have no health insurance at all. As a product of not having access to healthcare or paid sick leave, many workers are preparing and handling food while sick.

The report also offers solutions specific to policymakers, employers, customers, and workers, including:

  • For workers: Policy makers should support legislation that ensures workers have access to paid sick days, increase the minimum wage, and raise the subminimum wage for tipped workers to match the overall minimum wage. They should also support job-training programs, ensure that restaurant workers and their families have affordable access to healthcare, and protect workers from erratic scheduling and violations of federal, state, and local anti-discrimination and equal employment opportunity laws.

  • For employers: Adopt systematic and fair hiring and promotions practices — including anti-discrimination and harassment policies — and enhance job quality and employee retention by increasing wages and developing scheduling practices that meet both employer and worker needs.

  • For customers: Support responsible restaurant owners who provide fair wages, benefits, and opportunities for workers to advance.Speak to employers every time you eat out and let them know you care about livable wages, benefits, and opportunities for women and people of color to advance in the restaurant industry.

Find the full report here.

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Behind the Kitchen Door: The Highs and Lows of Seattle’s Booming Restaurant Economy

Restaurant Opportunities Center of Seattle’s latest report is the most comprehensive examination to date of the Seattle-area restaurant industry. The report draws on 524 worker surveys and 15 structured interviews with restaurant workers in King County, along with other industry and government data. It offers a vivid portrait of the state of the industry, and makes recommendations that will improve Seattle’s economic development, public health, as well as workplace conditions for the city’s restaurant workers.

Our research demonstrates that although the industry holds great potential in the wake of positive steps taken by legislators and high-road employers, major areas for improvement remain. Many restaurant jobs in the Seattle area are low-road jobs characterized by few benefits, low wages, and poor workplace conditions. Our report also unearths a range of serious problems related to the availability of benefits, hiring and promotion practices, workplace discrimination, and job-specific training opportunities.

Key findings include:

  • Despite promising steps to ensure higher wages, far too many low-wage restaurant employees are still not feeling the effects; 42.7% reported earning poverty wages. And despite a law requiring paid sick leave, only 37.4% of restaurant workers in Seattle are aware of the law and 73.5% report that they don’t have access to paid sick leave.

  • The vast majority of Seattle’s restaurant workers do not receive workplace benefits such as employer-provided health coverage (87.7%). In fact, 28.4% do not have any form of health insurance coverage at all, and 11.4% report having gone to the emergency room without being able to pay in the past year.

  • Seattle’s restaurant industry is anything but a level playing field for people of color and women. 56.7% of Asian workers, 59.8% of Black workers, and 77.4% of Latino workers worked in the Back of the House, compared to 47.8% of white workers. Furthermore, 38% of Front-of-the-House positions are occupied by workers of color, compared to 57.3% of Back-of-the-House positions. Women make up 22.6% of fine dining positions, compared to 57.2% of casual full-service restaurant occupations.

The report also offers possible solutions specific to policymakers, employers, customers, and workers, including:

  • For workers: Policymakers must strengthen and enforce employment laws in the restaurant industry that raise the tipped minimum wage, provide affordable access to health care, and protect workers from discrimination, harassment, and erratic scheduling. Policymakers should also increase awareness and understanding of those laws, support job training programs, and publicly support collective organizing among restaurant workers.

  • For employers: Adopt systematic and fair hiring, promotions, and scheduling practices, increase wages, and clearly communicate to workers about their benefits, as well as anti-discrimination and anti-harassment policies and procedures.

  • For customers: Support responsible restaurant owners who provide fair wages, benefits, and opportunities for workers to advance, and speak to employers every time you eat out and let them know you care about livable wages, benefits, and opportunities for women and people of color to advance in the restaurant industry.

Seattle has made tremendous strides toward improving working conditions for low-wage workers by enacting laws that require employers to offer paid leave, setting limits on the use of conviction and arrest records in hiring, and raising the minimum wage towards a living wage. However, there is clearly far more work to be done. We hope this report can help guide employers toward the High Road of sustainability, and legislators toward policies that ensure dignity and fairness for the city’s restaurant workers. ROC-Seattle stands ready and willing to act as a resource through every step of that process.

Find the full report here. 

Jim Crow report

Ending Jim Crow in America’s Restaurants: Racial and Gender Occupational Segregation in the Restaurant Industry

While Jim Crow laws regulated the enforced separation between white and African American patrons in restaurants, today restaurant workers are effectively separated by race and gender by a partition between livable-wage and poverty-wage positions. 

The restaurant industry employs 11 million workers and is one of the fastest growing sectors of the U.S. economy. Despite the industry’s growth, restaurant workers occupy seven of the ten lowest-paid occupations reported by the Bureau of Labor Statistics, and the economic position of workers of color in the restaurant industry is particularly precarious. Restaurant workers experience poverty at nearly three times the rate of workers overall, and workers of color experience poverty at nearly twice the rate of white restaurant workers.

By focusing on the state with the largest restaurant industry, California, which includes several cities that are repeatedly named among the top dining destinations nationwide and one of the most diverse populations of any state in the country, the findings in this report have national significance.

Based on government data analysis, a limited pool of employer interviews, and interviews with experts, the initial findings explored in this report suggest the need for further research to more deeply understand the restaurant industry’s occupational segregation problem and how to address it.

Key findings include:

-The greatest racial and gender wage inequality is in the highest wage occupational categories—namely fine-dining server and bartender positions. The restaurants with the highest wages and greatest number of employees had the highest rates of segregation in both Front-of-the-House service positions and Back-of-the-House kitchen positions.

– Worker interviews point to real structural barriers that workers of color face in accessing livable-wage fine-dining service positions, including lack of training, social networks, transportation, childcare, interactions with the criminal justice system, and more. Those real barriers result in employers lacking pools of candidates of color for hiring into fine-dining service positions.

- In California, Latinos experience the highest levels of directly observable occupational segregation, with substantial under-representation in the higher-paying server and bartender occupations, while African Americans are largely absent altogether from meaningful participation in full-service restaurant occupations and overrepresented in limited-service/fast-food occupations.  

- As a result of this segregation, overall after adjusting for education and language proficiency, workers of color receive 56% lower earnings when compared to equally qualified white workers. Women of color, on average, earned 71% of what white men earn, amounting to a $4-per-hour wage differential.

- States like California that have higher minimum wages have lower gender and race wage inequality than the national average, but the disparity is still quite high.

Find the full report here.

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Picking up the NRA’s Tab: The Public Cost of Low Wages in the Restaurant Industry

A day before the National Restaurant Association descends onto Capitol Hill for their annual lobby day, Restaurant Opportunities Centers (ROC) United releases a new report detailing the high public cost of the full-service restaurant industry’s low wages.

Although the restaurant industry is one of the largest and fastest growing economic sectors in the country, restaurant workers occupy eight of the ten lowest-paid occupations reported by the Bureau of Labor Statistics; at least five of these are in full-service. The lowest wage in the country is the federal tipped minimum wage which has been frozen at $2.13 an hour since 1991.

In effect, because the sub-minimum wage requires customers to pay the bulk of a tipped worker’s wages and through extraordinary levels of full-service restaurant workers being on public assistance, the full-service restaurant industry receives a double subsidy from the public.

Key findings include:

  • Nearly half of the families of full-service restaurant workers are enrolled in one or more public-assistance programs.
  • The cost of public assistance to families of workers in the full-service restaurant industry is $9,434,067,497 per year.
  • Tipped restaurant workers live in poverty at 2.5 times the rate of the overall workforce.
  • Restaurant workers as a whole experience poverty at a rate over twice that of the overall workforce – 20.9%.
  • Large full-service restaurant companies like Darden and DineEquity pay their workers so little that many of the employees of these companies rely on taxpayer-funded programs.
  • The taxpayer cost of a single Olive Garden is $196,970 annually.

With annual revenues of over $91 million, 750 staff, and nearly 40 congressional lobbyists, the National Restaurant Association (NRA) is one of the most powerful business lobbies in Congress and state legislatures. Its members are Fortune 500 restaurant corporations including full-service giants Olive Garden parent company Darden, DineEquity, Brinker International, Bloomin’ Brands, Cracker Barrell as well as fast-food companies like McDonald’s, YUM! Brands, and more.

Opposing raises for tipped workers — more than two-thirds of whom are women — is a particular priority for the NRA. As the leading force keeping the federal tipped minimum wage at $2.13 and lower than the regular minimum wage in 43 states, the NRA bears special responsibility for the gender inequities and sexual harassment produced by maintaining a two-tiered wage system which has resulted in the restaurant industry being the single largest source of sexual harassment claims to the Equal Employment Opportunity Commission and 90% of female tipped restaurant workers reporting they experience sexual harassment on the job.

ROC United is spearheading ‘One Fair Wage,’ a multi-state and national campaign to raise the lower, tipped minimum wage to 100% of the regular minimum wage, effectively eliminating the two-tiered wage system.

Find the full report here. 

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The Great Service Divide – National

Today, Restaurant Opportunities Centers (ROC) United, ROC-Michigan, ROC-Chicago, and ROC-New Orleans released a new report, “The Great Service Divide: Occupational Segregation and Inequality in the US Restaurant Industry,” an in-depth study of occupational segregation and discrimination on the basis of race and gender, which analyzed the hiring practices and promotional policies of 273 fine-dining establishments located throughout three principal majority-minority cities: Metro-Detroit, Chicago, and New Orleans.

Find the full report here.

Separate executive summaries available for Metro-Detroit, Chicago, and New Orleans.

drop orange

Darden: At the Drop of a Dime

Darden currently pays 20% of its 150,000 employees the federal tipped minimum wage of $2.13 an hour. Darden: At The Drop of A Dime comes as more than 7,000 people, including more than 5,600 Darden employees, have signed on to the petition, “Darden: We Want A Seat at the Table,” requesting that the leadership of Darden and Starboard Value listen to their concerns for the restaurant’s future.

Starboard, a major shareholder in Darden Restaurants Inc., recently proposed proposed several labor cost cuts to Olive Garden, including laying off up to 1,600 employees, increasing part-time scheduling, and passing more work onto subminimum wage employees.

If Darden passed the entire cost of the wage increase to customers, the menu price increase would be negligible. For example, the cost of Olive Garden’s Tortellini al Forno would increase by 10 cents, Longhorn Steakhouse’s Spicy Chicken Bites would increase by 10 cents. In fact, the average check at Olive Garden would increase from its current $16.75 to $17.10.

Darden Restaurants Inc., parent company to Olive Garden, Longhorn Steakhouse, The Capital Grille, Yard House, Bahama Breeze, Seasons 52, and Eddie V’s, is the largest full-service restaurant company in the world. It has faced increasing negative media attention as Starboard Value, an activist hedge fund and shareholder, is angling to take complete control over Darden’s board. Starboard recently proposed several labor cost cuts to flagship brand, Olive Garden, including laying off up to 1,600 employees, increasing part-time scheduling, and passing more work onto subminimum-wage employees.

Due to pressure from Starboard and shareholders, Darden’s CEO, Clarence Otis, and two top executive staff are set to resign with a severance package worth an estimated $65 million. Otis alone will receive more than $23,000 in cash severance alone every week for two years after his departure from the company. Meaning that Otis, after no longer being employed by Darden, will still get paid more every week than the typical line-cook, dishwasher, or server makes in an entire year.