Waffle House’s 'Best-Kept Secret' Is Out

In the next six months, the iconic diner chain hopes to hire 500 managers and 30,000 hourly employees starting with a message that dates back decades.

Photo Courtesy of jetcityimage.

You won’t see Waffle House on billboards or covering full-page magazine spreads. America’s most ubiquitous full-service restaurant, at more than 1,900 locations, has let word-of-mouth marketing do its talking since 1955. The private company doesn’t advertise and it likely won’t anytime soon.

But there has been a side effect. “That’s the reason we’re on the forefront but nobody knows we’re on the forefront,” says Philip Personette, Waffle House’s director of operations recruiting. “We don’t brag about ourselves very often.”

That cadence is shifting a bit, though, as the iconic diner chain charts a path out of COVID. Like nearly every eatery in America, Waffle House has welcomed a tidal of pent-up demand. Njeri Boss, VP of public relations, says guests came back with a “roar.”

However, while the appetite for dining out is undeniable, guests are often asked to exercise patience. A store might be understaffed one night; forced to flip to off-premises-only another, because “we couldn’t handle the way we like to take care of our customers’ dine-in experience,” Boss says.

According to Bureau of Labor Statistics data released Friday, restaurants added 61,000 employees in March. Yet still, the total count of roughly 11.54 million workers remained 750,000 short of pre-COVID levels. Overall in leisure and hospitality, employment is down 1.5 million, or 8.7 percent, since February 2020.

In addition, some 863,000 leisure and hospitality employees quit their jobs in February, representing 21 percent of the private sector—the most since November.

Throughout its history, Waffle House’ retention and recruitment efforts have, to Personette’s point, been the stuff of local lure. Employees in the system speak on it. So do the 120 or so recruiters the company has on the ground. “It’s probably our best-kept secret,” Boss says. “But we’re trying to get that story out a lot more now so people understand on the front end what the benefits we offer are.”

In the next six months, Waffle House hopes to hire another 500 managers and 30,000 hourly employees. Those are “pretty big numbers” for the company, Boss says. Applicant flow ticked up in Omicron’s wake, yet not quite to the pace Waffle House needs “to be able to make sure that every customer, every time they come in, are able to receive the kind of customer service that we’re known for,” Boss says.

As restaurants continue to blur service lines, layering digital, delivery, virtual brands, and other pandemic-ignited pivots into their business models, Waffle House isn’t having an identity crisis. The “relationship across the counter” between employees and customers, and vice versa, is non-negotiable, Boss says. “We will never change that—that is who we are,” she says. “That is the fabric of Waffle House. And even if everybody went to to-go and drive-up and ghost kitchens and all that, we would still have a dine-in concept because there’s something fundamentally important about being able to have that person-to-person contact.”

In other words, staffing has become priority No. 1 for Waffle House at this turn. The good news, Will Mizell, the chain’s VP of people and marketing says, is the brand isn’t playing catch-up in terms of what it can control. The underlying currents of today’s “labor crisis,” things like flexibility, career trajectory, and work-life balance, are points Waffle House pasted to the priority board well before COVID. The brand isn’t shifting tack as much as it’s now speaking up. “We’ve always said, we’re in the people business,” Mizell says. “And I know that sounds like a cliché, but we really mean it.”

This conversation stretches back to the beginning for Waffle House, but strode forward in the early 1980s. The chain started offering group health insurance for hourly workers, which was a near mythical industry benefit at the time.

Since, Mizell says, Waffle House has looked for ways to get employees invested in their roles and potential ladders.

Every manager in operations throughout the company started at Waffle House as a single-unit manager. Every promotion, at every tier, has been from within.

A key to this longevity is the fact managers are offered annual stock options based on a percentage of their compensation. Career stock options are granted at hire and with each promotion.

“We don’t bring anybody in,” Mizell says. “So that creates a strong culture. As you can imagine, if we only promote from within, retention has got to be pretty good, right? We can’t bet on stealing other people’s top management or senior management.”

Waffle House’s single-unit managers can evolve to district, overseeing three stores. And then divisions, with nine. Further up is area and region leaders, which direct anywhere between 20–30 locations and SVP, whose responsibilities cover 60–100 restaurants. EVPs are the level above.

But again, each tenured manager began with one store.

Waffle House leans heavily into performance-based growth. The stock options, in particular, are long-term career investments somebody makes in themselves as well as Waffle House, Mizell says. “We’re a privately held company,” he explains. “So we make money, our stock price goes up. It’s like you have stake in how well your stock does—the better you perform, the better your stock does.”

At the cook level, which Waffle House calls “grill operators,” there are three tiers (master and rock star are the next two up) and the better the skillset, the higher up the pay scale they go. They can become second or third shift supervisors, too. But all cooks are awarded bonuses based on the volume they cook each day. Once certified, pay rates range from $10–$16 per hour.

One of the most fabled of Waffle House’s perks is the “6 Days On, 2 Days Off Guaranteed” schedule it offers to managers. It’s as it sounds—six days on shift, two on break. “That’s kind of unheard of,” Mizell says.

More typical in the industry, at this level, is a “6 and 1” setup. Waffle House rotates the schedule and sets it at the beginning of each year so managers can plot time off, if they choose. So one week, somebody might have Monday, Tuesday off. The next, Tuesday, Wednesday. Etc.

“We take those off days very seriously,” Mizell says. “We do not let people work on them. If you are off, you are off.” District managers cover the days.

Waffle House managers also get three vacations per year. Essentially, they take the six days off three times, which amounts to three 10-day paid vacations.

At some of the senior levels (division manager and up), Waffle House has a “trip rewards” perk that used to be decided by an in-house competition. But in the last year, the chain decided to mirror the rewards systems generally associated with hotel or credit card systems—earn points based on performance and graduate into tiers. As you hit a certain level, kind of like sky miles, you earn a trip where Waffle House fronts a portion of the expenses.

All in, Mizell says, Waffle House’s compensation is competitive even without considering the additional carrots. Unit managers (in charge of a restaurant, with performance-based pay available) earn between $50,000–$65,000; district managers (responsible for two to three unit managers) $70,000–$98,000; and division managers (overseeing two or three district managers) $95,000–$120,000.

For going on 40 years, Boss says, hourly employees have had paid-time off at Waffle House. The company used to call it “vacation pay,” but a new generation of workers didn’t always connect the dots. In the last two years, Waffle House started calling it “paid time off,” and pays it in advance quarterly. Employees can use it however they wish as it accrues an hour for every 30 hours worked starting on day one. “It provides that option for even better flexibility than the flexibility they have with the job,” she says. “They can take a shift that actually fits their lifestyle.” Waffle House is a 24/7 operation and this comes into play with flexibility as well. There are employees, Boss says, who tap late schedules to free up their days.

Plus, workers can switch out shifts and adjust on the go. “That flexibility has always been key to what we offer at Waffle House,” Boss says. “Particularly at the hourly level.”

Continuing on from the 1980s, hourly employees have access to medical, dental, vision, and life insurance (there are three medical plans to pick from). Full-timers are eligible to enroll immediately with coverage beginning 30 days later.

Hourly employees, too, can purchase Waffle House stock for up to 10 percent of their pay after a year on the job. The company offers paid maternity leave of up to eight weeks (after two years). Also, Waffle House has direct deposit or pay cards to provide electronic pay each week.

Mizell says the brand has been working to get fully staffed—or close to it. Dining rooms, at least with social distancing, began to reopen in summer 2020 thanks to Waffle House’s dense Southeast footprint. “The majority of folks did come back,” he says. “We just need a few more to come back.”

Boss adds Waffle House navigated, and continues to address, the realities of today’s hiring climate. One point being the depth of people who left the hourly workforce due to childcare issues. Throughout the pandemic, women have been more likely than men to quit their jobs. Boss says Waffle House “lost a lot of women” who traditionally filled its ranks and were long-term employees.

“Until our workers figure out how to remote what they do in the restaurant—remote the food—it’s just not going to work,” Boss says. “We’re not in George Jetson land yet.” She says some current, pressing issues trace back to the outset of COVID and the broader message presented by regulators. Namely, the line drawn between what jobs were considered essential and which were not.

“And the bottom line,” Boss says, “is every job that is out there is essential to the person who has it.” The definitions created a lot of consternation on Main Street and in the workforce, she adds. It compounded for hospitality since officials commonly, and from the beginning, encouraged caution with dining at restaurants.

Pre-COVID, Boss points out, about 49 percent of all calories consumed came from restaurants. “So to make that key switch, the people having to go back to grocery stores to be able to cook their own food and meals—that was a huge shock to the system,” she says.

Yet the positive spin is what’s unfolding today: the “roar” in pent-up demand to get back to how things were Boss referenced earlier. And so, the employee angle factors in again.

When it comes to topics like sanitation and the “cleanliness theater” born by a more conscious consumer, it’s been a natural reaction, Boss says. Restaurants were always held to high food safety standards. “It wasn’t really difficult for us to enhance those measures,” she says. Waffle House cleans more frequently—and visibly—than before. Air inside restaurants turns over about every 10 minutes, and always has, Boss says. “There are a lot of things that restaurants were already primed to do, or were doing,” she says. “And they didn’t get the credit for.”

But having enough employees to satisfy that pent-up demand is the challenge. As of January, restaurants industry-wide were operating with fewer hourly staff than they did pre-pandemic, in 2019, per Black Box Intelligence.

“People who may not have frequented restaurants as often are now frequenting them more often,” Boss says. “And when you have the imbalance of the proper staffing numbers, we know how many people it takes to properly staff our restaurants; to be able to take care of crowds of people. When that is not present, it makes it very difficult on both our staff and the customer. So there’s frustrations going both ways.”

The median quick-service restaurant ran with 4.4 percent fewer hourly crew members per unit than two years ago, according to Black Box. Or one fewer hourly employee per restaurant. In full service, it was about 11 percent down in the front-of-house and 6 percent in the back.

It’s why, for Waffle House, retention surged to the forefront. When it gets great employees, it’s going to do everything it can to keep them, Mizell says. And that starts with sharing the message, both from a career potential standpoint as well as a quality-of-life one.

“You can build up a really good nest egg and we think it’s probably the best wealth generating deal that’s out there,” he says of the stock options in particular. “Not just in the restaurant industry, but just about anywhere.”

Waffle House’s off-premises business “probably doubled” during the height of lockdowns, Mizell adds. It’s still far higher than it was three years ago. In a way, he says, the fact people got used to it created a habit that’s likely to stick. Waffle House might just have expanded its customer base along the way.

However, reactions like selling sacks of hash browns to guests and rolling up food trucks, were pandemic success stories more than lasting changes in Waffle House’s DNA. As Boss noted, the brand is going to empty the playbook from a staffing and operations perspective to provide the experience it’s known for.

“Until our workers figure out how to remote what they do in the restaurant—remote the food—it’s just not going to work,” she says. “We’re not in George Jetson land yet.” If everyone else pushes their chips on that table, Waffle House will consider it a win.

“We welcome it,” Boss adds. “Because that means we’ll be the only game in town where you can still enjoy that person contact.”


Source: 2022 FSR Magazine.

31 views