There are few things in life that are as difficult to talk about as money. And when the money in question is as important to someone as their salary, the discussion can get even harder. But what makes a restaurant manager salary in particular easier to establish, present, and negotiate is getting your ducks in a row in advance. Knowing what the position is worth — and how your restaurant is going to compare to other offers a prospective manager may be fielding — can make hiring a restaurant manager a smoother process.
It’s easy to Google “restaurant manager” and find a salary number to drop into a spreadsheet. It’s a lot harder to know if that one-size-fits-all dollar amount is going to work for you and your restaurant. Taking any dollar amount at face value, without factoring in variables such as job responsibilities and your geographic location, could be a recipe for a disconnect when it comes to that crucial conversation.
Only you can know how your expectations for a restaurant manager line up to those in the marketplace, but beyond that, there are five considerable factors that will impact your decisions — and maybe your applicant’s ultimate decision to work for you — when setting a restaurant manager salary.
Restaurant Manager Salary in Your Segment
Beyond the obvious differences in compensation between a general manager, kitchen manager (which may very well be your chef), and assistant manager, your restaurant manager salary is going to depend a significant amount on the segment of the industry your restaurant occupies.
In the 2016 Restaurant Management Salary Survey conducted by Gecko Hospitality, a recruiting firm in Fort Myers, TX, that specifically targets the hospitality industry, starting salaries for general manager positions are broken up into six distinct categories, with the following average results in 2016:
|Segment||Female Average||Male Average|
(These averages are not classified by geography, but taken as a true average of 125 female and 412 male survey respondents nationwide.)
While quick serve and fast casual (both limited service) are pretty close in line with family style (defined as full service without alcoholic beverages), we see a fairly large jump to full service in both casual and upscale casual, and yet another, predictably, in general manager positions for upscale/fine dining. Not only do we see salaries go up with average check size, but as the expectation and requirement of service rises, so does the corresponding compensation.
Makes sense, right?
Experience vs. Salary
What’s less easy to nail down is how restaurant manager salary fluctuates with experience — and with the corresponding training your restaurant is willing or able to offer a new hire.
Many corporate-owned restaurants will recruit managers with relatively little experience (but college degrees) and fast track their education through a set training program. These management trainees will learn restaurant operations, both in formal classroom setting and on the job working with more experienced managers, until they pass a formalized set of guidelines that determine readiness to take on a unit of their own. These specific skills include opening and closing procedures, employee training, financial reports, and general human resources leadership tactics.
Restaurants without the structure or luxury to train new managers alongside existing ones will likely look to candidates with one to five years of experience in management. This could mean promoting someone internally or recruiting from outside, but these restaurant managers may only have a high school diploma. What they don’t have in formal education, they make up for in practical, on-the-job learning that may be more difficult to get in a fast-tracked educational environment.
While these two larger scenarios may not have significant salary differences in aggregate, it seems reasonable that a candidate with ten years of restaurant manager experience is going to have a salary expectation higher than an applicant with one year. A manager with formalized training may be more understanding about how their end goal salary will look the same whether they started with a bachelor’s degree or a high school diploma.
Set your own expectations for experience and level up from average range if the restaurant manager you want to bring in has more years under their belt than the minimum.
Gender Discrepancy in Restaurant Manager Salary
Something applicants distinctly recognize in the overall job market — and specifically the restaurant industry — in 2018 is the perceived gender gap in pay. And, as we saw in the Gecko Hospitality survey results, there is a reported 5-15% gap in pay between men and women for the same general manager roles. While this discrepancy in restaurant manager salary may be difficult to discern as an independent operator with only one restaurant manager salary to compare at a time, even seasoned vets are surprised by the results.
In reviewing the survey results, Robert Krzak, President of Geck Hospitality, observed, “We ran the numbers four times to make sure. [Women] are widely sought after for these positions, but when you look at how they are compensated you ask ‘what’s going on here? Are you kidding me?’ It’s really jaw dropping.”
Across almost every geographic location and segment of the restaurant industry, female managers report making less than their male colleagues. And your applicants know it. It’s more important than ever to take extra care to deliberately establish your restaurant manager salary agnostic of the gender of your candidates.
Federal Wage Regulations
While there aren’t specific federal wage regulations for management positions in the restaurant industry or any other, there are a few considerations to keep top of mind when setting your restaurant manager salary to save you hassle and money in the long run.
The restaurant manager’s job is tough, no bones about it. It often requires long hours, and most certainly more than a 40 hour work week. It’s important to establish your manager as exempt from federal requirement for overtime pay from the very start so that your actual restaurant manager salary doesn’t end up ballooning right before your eyes.
Currently, federal law sets the annual salary level for exemption from overtime pay at $23,660. Rules set in place in 2016 by President Obama’s administration, and since prevented from taking effect, raised that minimum annual salary for exemption to $47,476. It is expected now that when the Department of Labor issues its new recommendations for regulation, that number will fall somewhere in-between, likely in the low $30,000 range.
In terms of the salary averages presented above, its very unlikely any new federal regulations will be a problem in 2018, but it’s worth considering, particularly if hiring for assistant manager positions at your establishment.
Benefits Beyond the Restaurant Manager Salary
Ultimately, the biggest factor beyond local competition that may determine if your restaurant manager salary is indeed attractive is all the things that come with it that aren’t actually the salary itself. The benefits and considerations your restaurant offers its employees — manager included — could tip the scales for an applicant who is looking at the full picture in terms of compensation.
Health insurance is obviously a critical matter for restaurant employees going into 2018, but so is paid sick and personal time. Both of these benefits may seem like huge expenses, but their careful application can end up benefitting your bottom line just as much as your individual employee’s. Having to pay overtime for hourly employees covering shifts is unavoidable no matter what benefits you provide, but the number of days a sick employee is out — not to mention the number of people they can spread their illness to when resistant to calling in for unpaid time — is a huge factor in driving up unnecessary overtime and emergency call-outs.
Work-life balance generally is a big consideration for many managers, particularly for Millennials having worked in the industry now for upwards of 10 to 15 years. Making sure your candidates understand the full package of compensation — and not just the one number attached to a restaurant manager salary — could make the difference between an enthusiastic yes on offer and a reluctant no.
Want a leg up when you start to interview managers? Download our free list of “10 Interview Questions to Ask When Hiring Restaurant Staff” today!
Rewards Network does not provide tax, legal, or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors before engaging in any transaction.