More than half of all food consumed in Texas is provided by a restaurant. The food service industry is the state’s second largest employer, with a restaurant for every 1,000 people statewide. In the state of Texas, they have been closed to anything but takeout because of COVID-19, and now question becomes what to do for employees who have now lost their revenue stream.
In a letter to the President, Senate, and House Majority Leaders, the National Restaurant Association said it is “anticipating sales to decline by $225 billion during the next three months, which will prompt the loss of between five and seven million jobs,” of the 15.6 million people employed by the industry nationwide. The letter advocates for a $145 billion recovery fund for those in the industry, $35 billion in community block grants, and assistance to defer mortgage payments among other issues.
Texas Restaurant Association President and CEO Emily Williams Knight hopes that leaders will be thoughtful and not put a band aid on something that needs more substantive action. “Our leaders are being thoughtful about how we should tackle this and how can we help,” she says. “We know elected officials are making the right decisions for the public while balancing that with the economic needs of people in our communities.”
There are federal and state actions being taken to provide aid to those out of work, with H.R. 6201 signed by President Trump on Wednesday to offer some aid to small businesses, with those with less than 500 employees able to take up to 12 weeks of job-protected lead under the Family and Medical Leave Act, with 10 of those 12 weeks paid at a rate of no less than two-thirds of the usual rate of pay. In addition, the act required those same businesses to provide two weeks of paid sick leave for those who are missing work due to COVID-19. The bill offered tax credits to help fund the measures, and the bill provides $1 billion in grants to states for emergency unemployment insurance.
Williams said there is also state aid in the works that could allow small business owners to obtain low interest loans to pay their employees, but recommends that small business and restaurant owners consult the Texas Workforce Commission in order to find the best guidance. “For anyone who is contemplating closing, the Texas Workforce Commission can help you understand the best way to do this for your business and employees,” she says.
Bars that don’t have takeout capabilities are even more in peril, and some have taken action to do what is best for their employees. In Austin, cocktail bar Small Victory laid off its employees and closed before the city officially made any mandate (full disclosure, the bar is owned and operated by my sister Laura and her partner). The a speakeasy-inspired shotgun space, is only 1,000 square feet with no windows and no moveable tables, and is not conducive to the social distancing needed to keep COVID-19 from spreading. Bar manager Laura Maddox and her partner and owner Josh Loving operate Small Victory, and on advice from their investor and consultant Brian Stubbs, who runs restaurant consultancy Genuine Article in Austin. They began planning for the closure a few weeks before it happened.
Maddox was struggling to find enough cleaner and hand sanitizer to keep the bar disinfected, and when authorities in Austin mandated that every bar and restaurant have enough hand sanitizer for their customers on hand, she knew it would be a struggle. As she worried about following the ordinance as well as the safety of patrons and spreading the disease, bar leadership decided to close on Saturday night. “We literally put a closed sign up at 8:30 p.m., waited for everybody that was in the bar to close out, leave and then just shut the doors on Saturday night, which is our busiest night of the week,” Maddox says. “Not one more person will be in an unsafe environment because of us.”
The bar staff met and talked about the closure, and told the nine staff members they were being officially laid off. This would allow them to be first in line to apply for unemployment benefits, which they are more likely to receive if they are laid off rather than fired or quitting. If someone loses their job through no fault of their own and are available to work, they can receive benefits. “We just wanted to, if possible, be the first in line if we could for filing and try to get the maximum for our people,” Maddox says. “That’s the main thing that drove the quickness with which we acted.”
Maddox said the staff took the news well, and understood the importance of voluntarily closing for the safety of others, and knew that being laid off was the best course of action for their future finances. “I’m so flabbergasted and in awe of how cool everyone was,” she says. “To sit them down and tell them what’s going on, and have them understand that we were doing the best we could to try to take care of them was the biggest relief ever.”
Maddox says the bar is trying to get creative about finding ways to make money in the downtime, as well as not lest perishables go to waste. They are making care packages out of the cheese and fruit kept at the bar to send to their staff. She also knows that the choice to close was made easier because she has better support than many in the food service industry. For Austin’s robust bar and restaurant scene, not everyone can afford to miss a few weeks of pay.
“There are so many people who don’t have any options. They are just struggling and striving to hold on to this idea that they have to keep working and they have to stay open. I have a family support and business partner support. And I don’t need to have that stress,” she says. “But I’ve noticed there’s tons of people who are just living paycheck to paycheck, working for businesses that aren’t able to provide a safety net that are going to stay open until the very last moment. And I am just kind of horrified by it because I know that some lives will change in really dramatic and negative ways if they have to stop working.”
Even in these desperate times for food service workers, Knight has also remained positive. “What I have been blown away by, is how muchTexans love our food communities,”she said. “I am hearing about citizens across the state are leaving $500 tips. It is going to take every consumer doing their part.”