Check Please
The Paycheck Bounced!
This should be an obvious statement, but if you have employees of any kind, you have to guarantee that when the time comes to put their checks in the bank, the money is there. If it’s not, you and you alone have to find a way to get your extremely valuable employees paid as soon as possible.
If you can’t or won’t do that, for whatever reason, you are a horrible person and should not be running a business.
This may sound harsh, but, in May of 2017, I and about 300 other staff members of a small restaurant chain experienced our last paychecks bouncing right before the company abruptly closed and filed for bankruptcy.
The restaurant we all worked for was a casual bistro/pizza concept that turned more into a sports bar than a cafe, but whatever. The restaurant was having an identity crisis, but the food was good, the pay wasn’t bad, and the training was quite a bit more in-depth than any other place I had worked for up until then.
This restaurant had seven locations in Western Washington State - but probably should have stuck to two or three instead of trying to build a restaurant empire on the backs of people trying to make an honest living.
Unbeknownst to us we were the ones getting played the whole time, as ownership hadn’t paid any of the company’s bills for years, maybe the entire decade that they had been in operation.
I worked as a Sous Chef for this company, my brother was the Executive Chef at the location where we worked. He had been asking me for some time, to take the job that he had offered time and time again.
I finally said yes even though I hadn’t liked many things I heard about the company from others who had worked there before me, but I needed a bigger paycheck than I was currently getting, once again money was the great motivator.
During my first few months in this kitchen, we were swamped all the time, our bar was always full on evenings and weekends. We had daily specials that drew a crowd for both lunch and dinner every single day, sales were good and everyone was paid in full and on time.
Once we moved some people out and brought in a few new ones, and one old one, we functioned like a well-oiled machine from steak and whiskey Wednesday to our weekend brunch, the food at our location was the highest rated in the entire company.
Throughout this time ownership was accessible and helpful when help was required, if we needed a new piece of equipment or to make an emergency run to the store it was no problem.
After a while business slowed down, this is what happens when ownership gets rid of some favorite items and implements drastic menu pricing changes, when you rely on regular local customers you need to keep things consistent or sales will suffer, and they did.
As sales began to drop we were under increasing pressure from ownership to stay under budget in every category from our food and liquor budgets to non-consumables and of course labor.
Ownership understood that the kitchen needed more than one person to properly execute the menu and hit the ticket times that our corporate overlords desired.
However for some reason, thought that for the first half of the day, we only needed one person to run the front-of-house, after all, front-of-house labor was their main concern as they didn’t want to pay people to just stand around when we hit a lull in business.
Their idea was to schedule a few servers to open the restaurant, and if they weren’t needed for 30 minutes, send them home. But if we got busy again we were supposed to call them back, and then if we slowed down, send them home.
That system is ridiculous, and we never actually implemented it because nobody would ever comply with such nonsense, and they shouldn’t be expected to.
With sales still dropping months later ownership told us that they were going to be opening up not one more restaurant but two!
By now the company was losing money pretty rapidly, but the guy at the top was still spending money hand over fist on vacations, NFL, and MLB season tickets which included a private suite with concierge service that could procure whatever your heart desired.
By early 2017 every employee at our location could see the writing on the wall, our paychecks would bounce from time to time, but I justified staying because ownership was very apologetic and would always somehow get us paid.
It was obvious by now that the vendors weren’t getting paid. Sysco started to demand Cash On Delivery as did every other service that the restaurant used including our laundry and liquor suppliers.
We bounced checks to the Washington State Liquor and Cannabis Board. With our liquor license now being out of compliance the state shut down our bar for a week until we paid the licensing fee and the fines that we wracked up.
Shutting down our bar meant that over 50% of our overall sales would now be non-existent, and our budgets would soon get even tighter, not to mention the loss of tips for the bartenders, servers, and line cooks.
By April we had lost most of our staff, only a few loyalists that would soon go down with the ship remained, I was one of them.
Checks continued to bounce, vendors started calling and demanding to be paid, it was sad and pathetic. Legal notices started showing up daily, and some of these vendors weren’t owed more than a couple of hundred bucks yet the company just wouldn’t pay.
It was a Friday afternoon in mid-May, and the restaurant was fairly slow that day, with just a few orders for lunch. The small staff that we had there were all wondering where our Sysco order was, we then realized that our liquor order never showed up either.
Our final paychecks had already bounced two days prior but we expected that to be corrected that Friday, but it was not.
I took my paycheck to my bank and every other bank that I could find and none of them would touch it, thanks to the local news they already knew that our paychecks had no value.
All of a sudden my brother got a text from the director of operations, “Shut it down, send everyone home”, is what the message said. He called the Director of Operations directly but no answer, as he too was out of a job.
Every team leader got the same message, and we ended up sending everyone home without any explanation, just go and we’ll contact you when we know more, many staff members found out through the media.
Most of us ended up having to file a claim in bankruptcy court to get our last paychecks, which would come when the bankruptcy process had come to an end and funds could be recovered.
It was almost two years later that I received my last paycheck in the mail.
Sadly this kind of shit happens all the time in the restaurant industry and I’m sure it happens in other businesses as well.
As the owner of this place said in his open letter to the media, running a restaurant isn’t as sexy as it may seem, it’s a lot of hard work and long days for a modest salary at best.
Below is a link to local news coverage of the closure, and the link to an open letter from the Owner/President of the company.
Damn! Go read what I wrote today (with Andrew Sniderman):
https://goatfury.substack.com/p/movie-food
Basically, the same thing happened to me back in the late (or mid) 90s.
All the signs of desperation were there too. And, instead of filing for bankruptcy to get our last paychecks, somehow we were there on the day we learned the place was closing down. Let's just say that we made up at least some of the discrepancy in the checks. I'll write about all that stuff one day soonish, for there is a TON of drama to report.
Another interesting read. And an accurate take on what unfortunately often happens in the restaurant business. Having worked in the business, then being self employed in the accounting side for years with restaurants as a specialty I’ve first hand seen the incompetence and lack of restaurant mgmt knowledge of some in charge.