Advertisement

Food

What Obama's new overtime rules will mean for Dallas restaurants

You've probably heard that the Obama administration has issued new rules regarding overtime for American workers. The change in policy, which goes into effect Dec. 1, is expected to affect 4.2 million salaried workers who make less than the annual threshold of  $47,476 -- among them, many workers in the fast food and retail industries.

Looking beyond the fast-food industry to the broader restaurant world, Eater's New York-based critic and data lead Ryan Sutton has written an  excellent piece examining how the policy change could affect restaurant culture nationally.

The effects in North Texas could be dramatic. While the mean annual wage nationally last year for chefs and head cooks was $45,920, in Texas it was $43,380. It's not just chefs and head cooks who will be affected.  Many sous-chefs and kitchen managers are salaried -- and they typically earn significantly less than $45,000 per year.

Advertisement

"For chef-driven kind of joints, I guess the average for a sous chef is probably 40 grand," says Julian Barsotti, chef-owner of three Dallas restaurants, including Sprezza, which he opened in April. "That's just from word-of-mouth and hiring over the last several years." It could be lower or higher, depending on the type of restaurant, he adds.  Normally positions below sous chef would be paid hourly, though Barsotti says he's considering making his lead line cook position at Sprezza a salaried position. "We'll look at the economics," he says.

Julian Barsotti at Nonna, one of his restaurants, in 2015
Julian Barsotti at Nonna, one of his restaurants, in 2015(2015 File )

The rule change will be particularly dramatic for salaried cooks and chefs at restaurants that serve both lunch and dinner. "I know of people whose sous chefs work morning through close every day, which would put you at high hours in a work week. These guys typically come in at 9 to 10 a.m. and then don't leave till 10 or 11 at night, and generally it's a six-day week." In a scenario like that, a sous chef who's now working 72 to 84 hours per week with no overtime would now be paid time and half for 32 to 44 hours of overtime each week. "So it would make a big difference there, if they're not getting paid $48,000," says Barsotti.

Such a prospect might lead a restaurateur to reconsider the way employees are paid -- perhaps raising the salaries of certain employees over that $47,476 threshold so they're not require to pay overtime, or turning those positions into hourly positions.

Nick Badovinus at Neighborhood Services Addison in 2015
Nick Badovinus at Neighborhood Services Addison in 2015(Staff file)

"I think, like a lot of legislation, it will have radically different effects on different-sized businesses," says chef Nick Badovinus, whose Flavor Hook restaurant group owns three Neighborhood Services restaurants, plus Off-Site Kitchen and Montlake Cut.  Still, both Badovinus and Barsotti express the view that raising the ceiling is the right thing to do. "You just can't keep a number that's that critical in kind of a non-evolutionary static position," says Badovinus. "The cost of living increases tremendously."

Meanwhile, in a town where menu prices have gone through the ceiling in the last couple of years, the big question on many diners' minds will be: Does this mean we'll pay more for that steak or plate of pasta?

Eat Drink D-FW

The latest food and drink reviews, recipes and info on the D-FW food scene.

Or with:

Very possibly.  Though for restaurants where sous-chef salaries are relatively close to the new $47,476 ceiling, the rule change may not matter that much, says Barsotti. "If the median is that close, I think you just try to be tighter in other places as opposed to passing the cost off to the customer; I think you'd just try to tighten up operations."

Says Badovinus,  "I think the cost will ultimately be split between the business and the customer."