While there is no single answer to controlling labor costs, there are many different things that can be done to ease the task.
Forecast Scheduling. Using various tools at our disposal such as benchmarked levels of business, the schedule of club-sponsored events, and the catering forecast, supervisors should attempt to forecast their staffing needs at least one month out. The one-month horizon is important in that it allows time to contact, hire, and train seasonal help.
Seasonal Hires. When business conditions dictate (i.e., when the forecast shows business levels surpassing thresholds), supervisors should begin bringing in seasonal hires. They can be people who you have already interviewed, hired, and trained such as former employees or employees hired specifically for seasonal work. In either case, these new hires should be given some indication of how many hours they can expect to work each week and how long they’ll be kept on the payroll.
Conversely, supervisors should also plan for the sudden deceleration as the busy season comes to an end. Intelligently managing both the expansion and reduction of staff results in satisfied members and significant payroll cost savings.
Budget Time Off. Clubs have fluctuations in business on a daily and weekly basis as well as seasonally. These fluctuations can result in legitimate overtime.
Having also said that we want to avoid overtime costs as much as possible, the same fluctuations in business that cause these costs can also help us balance them out. Using the concept of Budget Time Off, a supervisor can send an employee home early on a slow day. Budget Time Off is used frequently in housekeeping and the food and beverage area. When the work is done or it’s slow, employees are sent home.
Budget Time Off should also be applied in areas where staff work established shifts, such as the reception desk, maintenance, or in administration. The concept works like this – if, because of circumstances, an employee works more than eight hours in one day, the Supervisor should send him home early on another day in the same workweek to avoid surpassing 40 hours worked in a given week.
Cross Training and Departmental Shares. In a small organization like the club, it does not serve us well to have a large staff of specialists. Rather, we should have a smaller staff of people who are cross-trained to work other positions. Often while one area of the club is slow, another is busy. Most cross training takes place within departments and allows a supervisor to deal with sickness and emergencies.
Another form of cross training is inter-departmental and results in departmental shares – employees who can work in two or more areas as the level of business requires. Departmental sharing requires close cooperation and communication between department heads to ensure that the needs of both staffs are met and cumulative overtime is avoided. Supervisors who are interested in exploring the possibility of departmental shares should pick other departments whose workload is dissimilar to their own.
Project Work. When fluctuations in business leave us with short-term lulls, supervisors who are concerned about keeping staff productively employed should assign project work. In a club operation, particularly one that has been busy, there are many things that get deferred in the crush of business. These deferred items, such an intensive cleaning, polishing the details, straightening out back- of-house areas, etc., make excellent project work.
Because we never know when business will suddenly be slow, supervisors should have a ready list of necessary project work. With this list at hand, it’s a simple thing to assign the work whenever staff have excess time on their hands in lieu of sending them home.
Sending Home Early. Sending home early is self explanatory and fairly easy to do. It requires the will to do it, vigilance on the part of the supervisor, and a feel for the business. While there is always some risk involved that we may suddenly get busy and need the full staff, supervisors should take the risk and depend on the dedication and professionalism of remaining staff to rise to the occasion. Experienced supervisors know that we all have an overdrive that we can kick into for short periods of time to get the job done. For those of us who are “adrenaline junkies,” (and who in this business isn’t?), we actually get a rush from it.
Layoffs. As long-term busy periods wind down, supervisors are often faced with the difficult task of reducing staff. While no one enjoys laying off employees, it is much easier to do if the employee(s) involved were hired seasonally and already know that their hours will be reduced or they will be laid off when the busy season is over.
Voluntary Leaves of Absence. Before a supervisor considers layoff staff, he should inquire if anyone on his staff – core or temporary – wants to voluntarily leave. There may be a temporary employee who for some reason wants to leave or a core staff member may want to take an unpaid leave of absence.
While no one may be interested, it’s always worth asking before another staff member is involuntarily laid off.
Scheduling Vacations. Full time employees earn vacation time. Some employees, by virtue of their longevity, have substantial amounts of vacation to use each year. Supervisors should schedule their employees’ vacations during slow times when you will not be forced to replace them on the schedule.
Summary. Regardless what combination of strategies ultimately proves most helpful to a particular supervisor, continuing success depends upon vigilance and attention to business levels and scheduling on a daily basis. The easiest way to achieve this is to make this vigilance and attention part of your daily routine. Compare daily hours and schedules frequently to ensure compliance. Checking employee hours daily will help avoid overtime. Pay close attention to levels of business. Know who is on the clock, what their schedule and rate of pay is. Act decisively to control cost. Act as if your job depends upon it. Ultimately, it may.
Thanks and have a great day!
This weekly blog comments on and discusses the hospitality industry and its challenges. From time to time, we will feature guest bloggers — those managers and industry experts who have something of interest to say to all of us. We also welcome feedback and comment upon the blog, hoping that it will become a useful sounding board for what’s on the minds of hospitality hardworking managers throughout the country and around the world.
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