Labor Law Compliance: 21 Questions to Keep Your Restaurant in Check

Mar 19, 2024 | 4 min read

Elizabeth Stacks

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Is your restaurant operation positioned for successful adherence to labor laws? Answer these key questions to evaluate your state of compliance.

Keeping up with evolving labor laws is a never-ending challenge for many restaurants across the US. Laws are regularly rewritten and modified at the local, state, and federal levels. For restaurant brands on the fast track for growth, this can be a serious roadblock when it comes to scheduling and labor management.

Laws can vary greatly across different states—from minimum wage, to minor laws, to Fair Workweek. This makes compliance incredibly challenging for multi-unit operators who operate across different regions. But for all operators, receiving a labor law violation is costly and can permanently tarnish a brand’s reputation. Despite this, many restaurant groups still lack an effective strategy to manage compliance system-wide.

In this challenging environment, restaurants need to create and implement a long-term compliance strategy with a coordinated approach across departments. Your strategy should be a living, breathing, documented program that is adapted as needed to meet the necessary regulatory requirements. But before you can create a successful compliance strategy, you must first evaluate the current state of your restaurant operation.

Ask yourself these questions to assess your restaurant's compliance program

Current Processes

How does our labor law compliance program work? (Explain in 45 seconds or less)
How do we train managers to understand current labor laws and how to create compliant schedules?
How do we currently utilize technology to stay compliant with all applicable laws?
In which area(s) does our compliance program need more work?
How do we currently communicate changes in labor laws and regulations to the necessary individuals across the company?
Do we have the necessary resources to create and execute our compliance program?

Growth Strategy

How do we research and stay up-to-date with regulatory changes that could potentially impact our operation in the future?
How do we factor different labor laws (like Fair Workweek) into our growth strategy?
Which store locations are most vulnerable to changing labor laws?

Managing Risk

Which store locations are most vulnerable to changing labor laws?
How are we currently monitoring changes in legislation that would impact our stores?
How does management take action when a compliance issue arises?

Roles & Responsibilities:

Who can provide a detailed snapshot of the labor laws that affect each of your store locations? (This includes regulations like Fair Workweek and other local laws.)
Who is ultimately responsible for labor law compliance, and how are they held accountable?
What third parties do we currently leverage in our compliance program?
What are we doing to ensure our employees in the field understand their responsibilities around compliance?
How does labor law compliance impact different departments like HR, Operations, and Training?

Monitoring & Reporting

What level of confidence do we have in our managers’ ability to create compliant staff schedules and manage labor?
How do we know that staff schedules being created today are in adherence with all applicable labor laws?
What KPIs do we currently measure around compliance?
How do we know we are measuring and monitoring the right information?

Start using the questions above to drive your discussions around compliance

The answers to each of these questions should reveal important information about your restaurant’s current approach to compliance. Most organizations find they have room to improve because compliance is a constantly moving target. Laws like Fair Workweek are evolving quickly, and they are not always easy to decipher.

Restaurants must find ways to adapt their daily operations to the current legal landscape. Every day, managers are creating or revising schedules that are heavily impacted by labor laws. During shifts, managers ensure that employees are clocking out on time, taking breaks, and all safety precautions are followed. After the shift, management must ensure that everyone is paid correctly according to the applicable laws, including minimum wage, tipped minimum wage, shared tips, and more. Compliance touches each of these aspects, but it’s often neglected.

For brands that operate stores across different jurisdictions, compliance is even more complicated. Laws are evolving quickly, and most restaurant managers are constantly being pulled in different directions. If your strategy is to simply press forward on an email about upcoming changes in minimum wage, you are not setting your stores up for successful adherence to the law.

Instead, labor law compliance should be purposefully integrated into your restaurants’ daily operations, from top to bottom. Although it is a complex undertaking, you can rest assured that investing in compliance is a worthwhile effort. Modern technology can alleviate the burden of managing labor laws and give you peace of mind for your restaurant operation. Every restaurant manager can create schedules confidently with scheduling software that automatically alerts you when a law is violated. By staying ahead of changing labor laws, you can future-proof your restaurant operation for the road ahead and ensure a future that is profitable and violation-free.