She didn’t say very much, but she was a stalwart feature in EastEnders’ Queen Vic pub for 30 years until she was given her marching orders in April. Tracey the barmaid was also unusual for another reason – few pub employers manage to keep hold of staff for years, let alone decades, and the industry has a reputation for high employee attrition.
With Brexit likely to mean curbs on immigration and high employment levels making it difficult to fill vacant roles, what can pub businesses do to attract staff who will stick around?
According to the most recent figures from skills organisation People 1st, labour turnover in the hospitality industry costs the sector £274m annually, with 870,000 of the 993,000 staff employers will need by 2022 required just to replace existing workers.
For pub employers, constantly having to replace staff or bring in temporary workers is both expensive and distracting when they’d rather be focusing on creating a great customer experience. They also have to deal with a perception that the pub industry can’t offer a long-term career – that it’s a “part-time pocket money” option, says Jill Whittaker, managing director of HIT Training, which offers training and apprenticeships to the hospitality industry.
“If we’re not careful, the situation will become untenable because the industry is growing faster than positions can be filled,” she says. “The pub industry needs to work together to dispel the outdated perceptions around working conditions and long hours, which just aren’t true anymore.”
Bucking the trend
There is a growing army of pub employers who are working to buck this trend, however. Coaching Inn Group, which won best pub employer (up to 499 employees) at this year’s Publican Awards, has reduced its staff turnover from around 97% to 60% in the course of just over a year.
Head of learning and development Lee Melton took a ‘back to basics’ approach in trying to address the issue. “We went back to the starting point and looked at recruitment. How we advertise, how we get our message out there,” he explains. “We changed the recruitment journey so you’re not invited to an interview, it’s a selection discussion, and we focus on personality over skill.
“Candidates have a ‘trialship’ where you spend a couple of hours behind the bar or with the restaurant team so we can see how you fit in. If someone’s got the right attitude, we can always teach them the skills.”
In addition, the company launched Career Pathways, a career development plan so employees can see exactly what skills and experience they need to acquire to progress to a supervisory or management role. “We wanted to be transparent about how to get to the next role, but also beyond that, all the way up to general manager,” adds Melton. Showing employees you’re thinking about their long-term future means they can picture themselves staying with your company, he believes, which, in turn, boosts retention.
Giving employees more autonomy over their careers – particularly Millennials, who are hungry for responsibility from an early stage – can also have a positive impact on retention. Bar chain Kuckoo runs on a ‘manager-less’ system, where traditional management responsibilities (such as drawing up the rota, stocktaking, cashing up) are split between the team and attract a premium on top of the basic salary. As employees learn more aspects of the trade, they take on more responsibility and earn more. “Working like this means they can own their own experience and development,” says Richard Powell, Kuckoo’s founder. “Some employers have really low expectations of their staff, they’re minimum wage assets just there to do a job.”
Brand champions
Many of Kuckoo’s bartenders have worked for its bars since they opened, and some have gone on to be “brand champions”, who oversee a number of locations. Powell adds that simple measures such as paying the basic salary monthly so staff know what they will earn each month and preparing rotas four weeks in advance so they can plan around shifts have also helped him to hang on to skilled workers.
The advantage of internal pro-gression is that employers can build a consistent culture, believes Graham McDonnell, HR director for cocktail bar group Be at One.
Its employee turnover currently sits at around 78%, and is much lower at management level, at 53%. Some 64 of its managers have been promoted from within, and 14 of its 35 general managers started as bartenders and have worked their way up.
The company recruited a head of retention to get to know employees’ motivations for coming to work, check they’re able to travel to and from its city bars and to find out a bit more about their ambitions. Employees earn more once they’ve completed their training to a certain standard, gaining further pay rises as they are evaluated three months down the line and then again at six months after that.
McDonnell says: “We run management assessment days every quarter, and if we see someone who shows promise, we put them forward. If there are areas they need to work on, we’ll do that first. The reason people leave is often because the place is not what they thought it was going to be. With us, they know what they’re getting themselves into.”
Cornerstone Inns has taken a novel approach to building hospitality careers. Its pub hosts, who run each of its six sites, do not have to worry about managing rotas, sorting out wages or dealing with HR issues, because this is all handled centrally. This cuts costs because shifts can be filled across all sites rather than being handled separately, and hosts can focus on what they do best – looking after customers.
The company also runs on an employee-ownership model – proven hosts have the option to purchase shareholdings of up to 25% in their pub’s business. “This boosts retention because employees feel they’re working towards the same goal – all profit is pooled together and shared by staff across all of the sites. It means every-one is focused on the bigger picture,” says Damon Horrill, Cornerstone’s managing director.
Apprenticeship levy
With many pubs struggling to fill existing vacancies before they even start hiring to support business growth, (see box) the arrival of the apprenticeship levy in April this year could present an opportunity to “grow their own” staff and train them from the ground up.
The levy applies to employers with a wage bill of more than £3m, who receive a payment into a digital account each month to be spent on apprenticeship delivery.
Companies that don’t have to pay the levy can still access up to 90% of apprenticeship funding costs, and 100% in some cases, for example, where the learner is 16 to 18 years old.
HIT Training is looking at a model that supports seasonal workers and enables them to undertake an apprenticeship despite taking a break between contracts. “By introducing this type of flexibility, the apprenticeship will encourage talented employees to return season after season and hopefully lead to a long-term career in the field,” says managing director Jill Whittaker.
Coaching Inns has already looked at ways it can maximise its levy payments by mapping existing training courses across to new apprenticeship frameworks – it currently has 65 people on apprenticeships between the basic level 2 scheme and level 5, which is equivalent to a foundation degree.
A level of churn
But while many pub employers are making great strides in building long-term career strategies and holding on to good workers, businesses should also accept there will always be some level of churn, says Charlie McVeigh, founder of beer chain Draft House.
“High retention has its own challenges too,” he says. “People can get stale, it can cost more because you’re giving annual pay rises, and a mix of old and new people can be good. You want a mix of those people who are more ‘transactional’, who always come in on time and do the job well, and the ‘rebels’, the people who are slightly different and give your culture some personality.”
His company has identified that the people who tend to perform the best and stay longer at Draft House have one key quality – resilience. “If we’re looking to promote someone, they could have all the skills but if they did not have resilience we wouldn’t promote them. If you work in a pub, you’ve got to refuse to let things get you down – and the people who stay tend to do that.”
McVeigh adds that pub employers need to make more of how quickly employees can build responsibility and take on important aspects of the business. He concludes: “What’s unique about our industry is the rate at which you can progress – someone can often be a manager within a year – there are not many other sectors where that would happen.”
Make the most of the apprenticeship levy
The apprenticeship levy, which took effect in April this year, is a compulsory ‘tax’ for employers with an annual wage bill of more than £3m, who then receive payments for training, which must be spent on apprenticeships. Non-levy payers can also access funding, up to 90% of training costs. Trade body the British Institute of Innkeeping has come up with a checklist for employers on how to make the most of it:
■ Check employees are eligible: they must be in a new job or existing role where you can demonstrate there’s a need for new skills and knowledge.
■ Ensure the apprenticeship will meet your employees’ and your needs. Accredited apprenticeships must take at least 12 months and involve an assessment at the end, so make sure your apprentice can meet these criteria.
■ Make sure you allow enough time for their off-the-job learning, which is around 20%. They may also need additional time and support to review learning materials or prepare for assessments.
■ Remember to use your allowance. If you pay the levy, you will have the equivalent money paid into your digital account and if you don’t spend it in 24 months, it will disappear.
■ Find the right partners. Training organisations offering apprenticeships must be on the register of apprenticeship training providers held by the Government. The skills funding agency has a list of those providers that can be used for levy funds – go to www.gov.uk/guidance/register-of-apprenticeship-training-providers for more details.