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Something to think about when you visit a Darden Restaurant

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  1. Because you previously believed them to be treated like respected employees? Endless breadsticks have a price.....

    1. I agree it is pretty lame, but.. As noted in the article, businesses, particularly retail and fast food, have been doing this sort of thing for years. Some of the things noted are not limited to these two industries. For example, from the article:

      >>>
      Starting next year, the company will change the way it offers health insurance to full-time employees, to keep costs more predictable. Instead of offering one insurance plan for all 45,000 employees, it will give workers a contribution toward buying coverage and then send them to an online health insurance exchange where they can chose from five medical, four dental and three vision plans.
      <<<

      This is nothing new. The (large) company I work for been doing this for as long as I have worked there (over 20 years). We get a "healthcare offset" as part of our pay package and then get our choice of several health plans, which we pay for pay for ourselves through payroll deduction. In my case, the "offset" pays less than two months of the annual premium.

      I do agree, however, that some of the other practices they've implemented border on criminal, IMHO. Requiring "shared tips" just so you can pay the bus boy over five dollars an hour less is pretty cheesy. It's not like these guys are exactly "raking it in." I'm sure their portion of the shared tips nowhere near offsets to the cut in salary... Not to mention the "pay cut" to the servers who are now getting less of the tip money.

      Though I can't remember the last time I've been to a Darden restaurant, I will certainly think twice before choosing them in the future.

      1. I read the same basic story on Gawker yesterday: http://gawker.com/5950331/olive-garde... I already refuse to eat at these restaurants, but this is reinforcing (I'm not one of those 'hounds who subscribes to the "sometimes you have no choice" rationalization school).

        It's time more people put thought into the way they consume and the impact of the dollars they spend. I mean, is it really worth tolerating bad food to support a corporate structure designed to suck as much profit out of the company as possible? I'm sure poorly treated employees make wonderful servers too.

        Then again, I suppose we can solve the entire issue by simply fast-forwarding to the inevitable and begin to nationalize the healthcare system.

        7 Replies
        1. re: MGZ

          Then I hope you start being choosy about the other retailers you buy from

          1. re: C. Hamster

            I've doing that for a long time. An example discussed here:

            http://chowhound.chow.com/topics/872479

          2. re: MGZ

            I agree i principle, but given the number of people that own Apple products (and yes, I'm guilty as well) and the well documented factory worker issues there, I just don't think it's all that top of mind and nor do people really care.

            1. re: FattyDumplin

              True, but I don't rely on The Olive Garden to run my entire life like I do my iPhone.

              1. re: nsenada

                So whether you care about worker welfare depends on whether it impacts your daily life? Just playing devil's advocate here... I'm certainly the worst offender here - I don't really care about the machinations of corporations. Just get me the best damn product at the lowest price possible and I'm pretty satisfied. Geez, I feel like a bad person even as I type this.

                1. re: FattyDumplin

                  Sadly, yes - not much I can offer for justification. In some categories, I hold my nose and buy, but I don't feel good about it.

            2. Health care consumes 17% of the GNP in the US, by far the highest in the world. It is a daunting task for employers in competitive US industries to provide health care benefits.

              6 Replies
              1. re: Veggo

                Agreed, but cutting someone's hours just so you don't have to pay for their healthcare right after giving them a $5/hr pay cut is criminal. Even if the tips *did* offset the pay cuts (which I doubt) it's pretty hard to live on $7.25 an hour.

                I tend to be a supporter of free enterprise, but this is, IMO, going to far.

                1. re: al b. darned

                  You summoned up a recollection of an old Procol Harum song " Still there'll be more".

                2. re: Veggo

                  Thats because we have the most scrwed up health care delivery system of any developed nation. Most health care consumers pay only a small fraction of the actual cost, costs are massively shifted, there is no price transparentcy, doctors practice defensive medicine to avoid massive lawsuits, etc.

                  Image if your employer paid for your food, and grocery store shelves and restaurant menus had no prices on them. What percentage of our GDP would be spent on food?

                  1. re: carolinadawg

                    You're right. That's why the whole thing is just postponing the inevitable.

                    1. re: carolinadawg

                      Right - there is no incentive to keep the costs in line in our system, which is why that GNP number is so high. If Canada, Australia and the UK can do it, why can't we have our half-assed version of universal healthcare?

                      This is great because now I have further justification for nixing family outings to Olive Garden.

                      1. re: nsenada

                        You're right, now there should never have to be another one of these threads again:

                        http://chowhound.chow.com/topics/870443

                        If a 'hound doesn't want to go, they have an ethical objection to eating lousy food.

                  2. Hard to blame Darden for changing business conditions. Its not their fault and its not just them. Every business will have to make these sort of adjustments if things don't change.

                    14 Replies
                    1. re: sal_acid

                      Darden's paying a quarter of a billion dollars a year in dividends. Clearly, they have the cash to adopt a corporate model that was more employee friendly. They are merely looking at an anticipated change in the environment and reacting to it in a way that continues to be "shareholders first". With that thought in mind, it would seem the next place they would look to save money would be in procuring lower quality ingredients, shrinking portion sizes, etc.

                      1. re: MGZ

                        Recall that the principal objective of any company is to make a profit. Similarly, on an airplane, if there is a pressure failure and oxygen masks deploy, you are advised to put yours on first, before you begin to aid others. It's difficult to help others if you don't have a pulse.
                        Darden has smart people. Some of your theoretical "next"s would be ruinous to their business, and won't happen. Many elements of a business's expenses must be in a precarious balance to allow for modest success and survival, not all of them popular.

                        1. re: Veggo

                          There is a difference between making a profit and squeezing out the maximum profit possible. The latter notion is based upon the corporate governance concept referred to as "shareholder value". It is a relatively new one.* It's preeminence is largely the product of having changed compensation and bonus structures for corporate officers.** There are, and have always been, other approaches to making a corporate profit.*** We've just grown used to it.

                          Corporate governance issues are quite well known to me. As is the operation of a business. At bottom, if a company like Darden is happy to take advantage of all of the benefits and "handouts" it takes from the Federal government, It should be willing to absorb some of the detriments that it thinks may occur. Hell, if only until they actually know what effects they will feel.****

                          *If I recall, it's been about thirty years since Jack Welch first articulated the notion. He has subsequently criticized it.

                          **For some discussion of the notion: http://blogs.law.harvard.edu/corpgov/...

                          ***Take a look at former Citicorp Chairman, John Reed's discussion of some of these types of issues. Banking and Wall Street changed *very* dramatically in the 90s. http://billmoyers.com/segment/john-re...

                          ****My years in law have made me incredibly unpolitical, but in a way, Darden's decision and press release seems rather, um, shall we say, timely?

                          1. re: MGZ

                            This is like giving an Oscar to a movie based on critic blurbs.

                            1. re: ipsedixit

                              I added the missing link. (pun, sort of, intended).

                              Edit - I seem to be having some problems with completing posts. Forgive me.

                            2. re: MGZ

                              I am half ashamed to admit that I went to one of the best business schools in the world, because I loathe how capitalism has evolved and has been nearly perfected for the benefit of very few over the last 40 years.

                              1. re: Veggo

                                And, I am ashamed to admit that I spent time in The Chancery Court helping perfect such changes.

                                1. re: Veggo

                                  Veg...
                                  I no longer even list that same school on my CV when I know it's going to be used as details to introduce me when speaking.
                                  Too much has changed in the last 40 years and I don't enjoy the backlash from the audience. Instead I focus on my acheivements. 40 years later, listing where you attended school is meaningless, instead track record counts.
                                  But from the old school song:
                                  'Drink a highball at nightfall....' is still good advice. Just not at the bar in a Darden restaurant

                            3. re: MGZ

                              I bet some of those Darden employees are also Darden shareholders. 'Natch.

                              1. re: ipsedixit

                                And I'd bet they're the ones who get to work full time and already get benefits.

                                1. re: MGZ

                                  If you did, you'd lose money on that proposition.

                                  1. re: ipsedixit

                                    You're right, at least "some" do. Though at less than eight bucks an hour, it can't be too many.

                              2. re: MGZ

                                >>>
                                ...and reacting to it in a way that continues to be "shareholders first"...
                                <<<
                                Whether we like it or not, the purpose of the management in a stockholder owned company is to increase value for stockholders. Anything that reduces that return (such as mandatory healthcare costs) has to be offset in some other area. The only companies that can really treat their employees well are privately held ones (think Wegmans).

                                I want to make it perfectly clear that I don't agree with the "shareholders profits at all cost" model, but IIRC, the courts have upheld that when stockholders have sued the company for being "overly generous." It is also the reason most manufacturers have moved their operations overseas. Lower production costs mean higher profits.

                                1. re: al b. darned

                                  Please see my response to Veggo above.

                            4. I think Darden should just convert all of their employees into independent contractors, pay them via 1099s, and avoid all healthcare costs.

                              It would certainly make that gummy bowl of pasta cheaper!

                              18 Replies
                              1. re: ipsedixit

                                When one thinks about it, it's a bit of a curiosity that the burden of health care falls mostly on employers. It's a convention that carries back to days of mining and dangerous and unhealthy work environments, most of which are now obsolete. For those that are still inherently risky, the pay is commensurate. I think most of us would agree that Darden restaurants are not hazardous workplaces.

                                1. re: Veggo

                                  "I think most of us would agree that Darden restaurants are not hazardous workplaces."

                                  Unless they have to eat the food.

                                  Seriously though, as to the burden of healthcare, it no longer falls on the employers - it ultimately falls upon the State. That's why the inevitable result is comprehensive, nationalized insurance.* The only question is how much money gets wasted until then.

                                  *It would be best to have the government run it, if only because it will still be the option of last resort. Nonetheless, until all care and the, sometimes adverse, consequences of it are consolidated somewhere, we will bleed money.

                                  1. re: Veggo

                                    Veggo and MGZ

                                    A sad thing somewhere between your good reasoning is an even more onerous way.Currently being examined,seriously considered by a not so short list of biggies,to include FORBES & FORTUNE 500'S.Calculate,tabulate the cost of existing plans,the law coming down the pipeline,administration employees and number of eligible employees and then TOSS all of it and PAY THE FINE.The fine for many is way less $$$ than the overall cost currently and future compliance.

                                    1. re: lcool

                                      At least that generates offsetting revenue. Moreover, given that the penalty was based upon the estimation of the cost per employee, it can be raised with legislation.

                                      1. re: MGZ

                                        Legislation at the state level is ? .I can think of at least 15 states that won't touch it with a 10' pole in a timely manner.
                                        The models I have seen,send not a dime toward the employee.
                                        Husband's small company,in the highest risk workman's comp bracket in Maryland, take a return on revenue view.Dumpsters,5 small a year = $12,000.00 two years ago.I told our guys,"this is b...s..." .A total waste of $$ and encourages you to be sloppy AND PISS ME OFF with the sloppy.So,from now on out we recycle( + 80% ) and you carry your little bags of lunch trash etc HOME everyday.OR ELSE
                                        Compliance was 98% in two weeks and 100% since.CPA and spouse were all thrilled about the first quarterly after 4 months .I explained where 70% of the windfall ($5,500)came from with fuel up 15% and that it was going to be paid right back out as bonuses to the 15 guys that made it happen.Not an extra crane payment.We like our people,want to retain them and most of all not go through the hire and train $crap.Much of having good employees is,caring to retain them.

                                        1. re: lcool

                                          The ACA is federal legislation. The $3,000 per employee "tax" applies only to companies with 50 or more full time employees. The revenues would go to the Federal government, not employees. In my view, getting the levy changed to 4 or 5 grand per violation in order to effectuate the fundamental purpose of the law might not be that hard. Then again, I suppose this is all dependent upon the level of Washington dysfunction after the upcoming election.

                                          1. re: MGZ

                                            I figured they made the penalty that low, strictly to encourage companies to dump their plans and pay the penalites, so their employees would migrate to the federal one, and it would have more participants.

                                            Anyone with a passing knowledge of health care would have been able to set a more reasonable penalty. It was done on purpose.

                                            1. re: Snorkelvik

                                              Hopefully, you're right and we can take the next step to nationalizing.

                                    2. re: Veggo

                                      Healthcare for workers is a relatively new development, more of a marketing tool than anything ("work for us and we'll throw in healthcare"). Schoolteachers were insured well before miners, so it wasn't based on hazard, it was an incentive to bring in better workers. It wasn't until the post-war years that it became commonplace.

                                    3. re: ipsedixit

                                      Great Idea, NOT. An indepentent contractor cannot be assigned a specific time and place to perform his/her task. So if contractor server wants to work 8-11PM, no one may be available to serve your table at 7:30, similarly the contractor server may not wish to serve a particular station.

                                      and I know you are not being serious, but I've spent many an hour in court representing workers who were illegally made independent contractors when in fact they met the legal definition of employees and were entitled to those protections and benefits due employees.

                                      1. re: bagelman01

                                        I am being serious.

                                        Employer mandated health coverage is silly.

                                        1. re: ipsedixit

                                          Ipse, if only life were so simple. Employers with 50 or more employees are subject to a daunting cornucopia of benefits that must be provided, and long lists of compliance requirements. Any company with 50 employees needs at least one full time HR person to have a chance to keep up. The transactional friction and costs are enormous.

                                            1. re: ipsedixit

                                              So $2 worth of hamburger and fries cost 10 bucks. I eat out far less frequently than I used to.

                                              1. re: Veggo

                                                Which is why employer mandated healthcare is such a silly, inefficient notion.

                                                Not to mention all the health-related accommodations employers have to provide to employees.

                                                1. re: ipsedixit

                                                  Or the 3 employees put on restricted duty for 2 days in one year for a hangnail, triggering the full blown OSHA inspection and $10s of thousands of fines.

                                                  1. re: Veggo

                                                    ... and don't forget the workers compensation claim and/or any possible related ERISA issues.

                                                    I'm just waiting for the day when a McDonald's FoF is outsourced to India or China.

                                                    "Well, thank you for your order, the FoF should be here tomorrow via DHS!"

                                                  2. re: ipsedixit

                                                    Like I said, there's an inevitable conclusion to the issue. Perhaps, someone will have the balls to say when to pull the leeches and stop the bloodletting?

                                      2. Is Darden the chain where we aren't supposed to eat because they hate gays or is that someone else? I have trouble keeping it all straight.

                                        2 Replies
                                        1. re: redfish62

                                          Darden's the place you should avoid because they have contempt for consumers.

                                          1. re: ferret

                                            Darden's is the place you should avoid because the quality of food is typically so mediocre (much better is typically available elsewhere for better pricing).

                                            Now the real question, with all the available restaurant jobs why would anyone want to work for them? Do they get to take home the extra bread sticks?