How can employee turnover in restaurants be reduced through proper distribution of tips?

Most restaurants pay their waitstaff a minimal fixed base wage, with the majority of their income coming from tips. As a result, the amount of tips greatly influences the satisfaction levels of the waitstaff and, consequently, the turnover rate of employees. During peak hours with high customer traffic, the tip pool is maximized, but there are also more staff members to share the tips among. During slow hours, tips tend to be lower. If a restaurant fails to forecast the necessary number of staff, there may be more employees than needed during certain hours. This can lead to dissatisfaction among the waitstaff due to lower amounts of distributed tips, prompting them to consider changing jobs. According to the Blackbox Intelligence/Snagajob report from 2022, the primary reason for job changes is seeking higher income elsewhere.

To avoid this situation, our product includes a Labor Forecasting module, which allows for predicting the required number of staff in a restaurant. However, it is crucial to strike a balance, avoiding both excess and insufficient staffing levels. Overstaffing can lead to employee overload and dissatisfaction.

Based on our experience, proper staff planning can help reduce employee turnover by 3-5%.
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