Chipotle CEO: Coronavirus spike, colder weather driving off-premise business
Chipotle Mexican Grill CEO and Chairman Brian Niccol on how the nationwide spike in coronavirus cases is shifting business operations.
Chipotle is encountering a staffing dilemma as COVID-19 continues to sweep the nation and sideline workers who have contracted the illness. The recent resurgence in cases has forced the fast-casual chain to temporarily restructure its operations at a number of restaurants.
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“With more restrictions being instituted due to rising cases of COVID-19 across the country, we’re seeing a very small number of restaurants impacted by available labor,” Chipotle's Chief Corporate Affairs Officer, Laurie Schalow, told FOX Business. “Therefore, we’ve had to adjust hours or close for a limited period of time when staff from neighboring locations was unavailable.”
In response, Chipotle has expanded its emergency leave benefits to accommodate those directly affected by the pandemic. Those individuals can receive pay equal to their upcoming two-week schedule or average hours worked.
Chipotle’s announcement comes as restaurants struggle to stay afloat amid restrictions on capacity. Outdoor dining provided some financial relief for eateries the past few months, but the looming winter season combined with rising infections has sparked concerns about long-term viability for businesses. While thousands of local restaurants have shut down during the pandemic, national chains are not immune. One of Applebee's largest franchisees filed for Chapter 11 bankruptcy last month and noted the pressing challenges in mitigating COVID-19 cases amongst employees.
Fast food king, McDonald’s, has also faced a rise in cases among its staff and has received scrutiny for its mishandlings. In May several workers filed a class-action lawsuit against the chain over COVID safety and protection issues.
Despite the health and business challenges, Chipotle is not cutting back but rather looking to expand its employee base.
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“At Chipotle, we are actively hiring for roles across the country from crew members to management-level positions,” Schalow said.
But the 2,600-plus store chain may be an exception. The National Restaurant Association reports that nearly one-in-six restaurants have closed and some three million restaurant employees remain unemployed. It is projected the restaurant industry will lose $240 billion in sales by the end of 2020.
“For an industry built on service and hospitality, the last six months have challenged the core understanding of our business,” National Restaurant Association President and CEO Tom Bené said in a press release, “Our survival for this comes down to the creativity and entrepreneurship of owners, operators, and employees. Across the board, from independent owners to multi-unit franchise operators, restaurants are losing money every month, and they continue to struggle to serve their communities and support their employees.”
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