Employee benefits for catering and hospitality staff

The catering and hospitality industry encompasses a wide range of venues and services, including pubs and cafes, high-end hotels and restaurants and catering companies. They share a need for exceptional service quality and employees with excellent people skills.

The day-to-day reality is that hospitality employees are often customer-facing and involved in physically active, stressful roles. Seasonal demand and a combination of full-time, part-time and casual working can present challenges for employers, particularly given the sector's high staff turnover and labour shortages. Supporting your staff with a high-quality employee benefits package can help your business meet these challenges.

Catering and hospitality employees are passionate about their work, and many recommend a career in catering to others. However, the demands of the work can lead to burnout and a move to a different industry. Your employee benefits package can provide excellent support, provided it's designed with these challenges in mind. Let's consider a few factors that can lead to health issues and high turnover.

Long and unsociable working hours

Hospitality employees often work during others' downtime, serving food and drinks in the evening, on weekends, or on bank holidays. They'll often find that when they have time off, friends and relatives with 9-5 jobs are at work. They can also face long working hours, preparing for opening or setting up for an event, then clearing up at the end of the day. Their working patterns can make it difficult to maintain friendships and manage family commitments, leading to social isolation and a struggle to achieve a positive work-life balance.

Dealing with demanding customers and managers

Customer-facing roles in hospitality can be stressful, as customers have high expectations for the level of service staff deliver. Hospitality employees will work to achieve high standards, but may also have to handle complaints or challenging behaviour from clients. This can create stress not only when dealing with complaints but also from the emotional labour involved in understanding and managing customer expectations. This can become more pronounced during peak season, for example, over Christmas, or when catering special events like weddings.

Managers will also feel the pressure and may be more demanding of their staff.

Understaffing and unpredictable demand

Some seasonal events create greater demand, which we'll discuss shortly. However, footfall can fluctuate at some venues, creating uncertainty about the staffing levels required. The sector faces staffing shortages, with approximately 77,000 vacancies in food and hospitality across the UK, leaving some venues short of staff to cover peak periods. This can increase stress levels among restaurant employees who must meet a heavier workload. Prolonged stress can lead to burnout, causing hospitality workers to leave the sector altogether.

Heavier workloads during peak season

We've mentioned the pressures that staffing shortages can create, but these can become particularly acute during peak season, when consumers are more likely to eat out or arrange social events. The Christmas party season can significantly increase demand, while wedding venues may find themselves booked well in advance. Key dates such as Christmas, New Year's Eve, Easter, Mother's Day and Valentine's Day are likely to need a full complement of staff. Unfortunately, this often clashes with their desire to take time off and spend time with their loved ones, affecting their work-life balance.

Physical health and injury risks

There are two distinct challenges that restaurant employees can face regarding their physical health. Food service environments pose a higher risk of injury due to slipping hazards from spilt food and drink, as well as burns and cuts from working in the kitchen.

There are also chronic health issues that can develop over time. For example, restaurant employees typically spend most of their working hours standing, walking, or performing manual handling tasks. These can lead to musculoskeletal issues or repetitive strain injuries that build gradually.

Financial stress

A regular work pattern can support a good work-life balance and provide a predictable income. However, this may not be the reality for all hospitality workers. Many venues take tips, which can boost employees' income, but are often unpredictable. Research found that the median hourly pay is often lower for hospitality workers than for staff in other sectors.

This unpredictability can make budgeting and financial planning difficult or lead to financial stress, which can impact employees' mental well-being.

Higher staff turnover

The hospitality and restaurant industry has significantly higher turnover than other sectors. A CIPD analysis of employee turnover rates between 2022 and 2023 found that while 47.8% of hospitality staff had remained with the same employer, 40.7% had moved on, while 11.5% weren't working within the industry at all.

High staff turnover increases recruitment and training costs for employers and affects team morale. Employee satisfaction often starts with a positive workplace culture and strong relationships with colleagues. Many employees will choose to stay in a role that fosters teamwork and workplace friendships.

Limited career progression

Some may view a job in catering or food service as a stopgap rather than a long-term career. Younger people combining part-time work with school or university will likely move on if their course focuses on a different industry.

However, many employees see themselves working in catering in the long term but leave because they lack career growth opportunities or a clear career development pathway. Restaurant owners may lose top talent due to a lack of awareness of the opportunities available.

Poor mental health and burnout

The factors we've already discussed can all combine to impact employees' mental health and well-being. A high-pressure environment, lack of financial stability and poor work-life balance can cause stress, anxiety and depression. Burnout occurs when stress becomes chronic with no prospect of relief. For example, if your business is fully booked but has ongoing staff shortages, your existing employees will likely need to work longer hours or have fewer rest days.

Research suggests that some staff view burnout as part of the job, with over 60% of respondents reporting a mental health issue. The good news is that a good benefits package can boost employee well-being and job satisfaction.

The challenges we’ve described can impact physical and mental health, including financial stress and difficulty creating a positive work-life balance. Your employee benefits package can help minimise risks, improve employee well-being, and provide quick access to medical care when needed.

While career growth opportunities aren't employee benefits in themselves, it's also worth considering what your business can offer staff who see hospitality as a long-term career.

Employee health insurance

Employee health insurance provides a range of benefits, including access to private medical treatment. Health insurance policies provide core coverage as standard, including in-patient hospital treatment, counselling and some out-patient services depending on your chosen provider. Business policies often include employee health assessments, well-being guidance and resources. Depending on your chosen provider, you may also be able to access guidance on setting up workplace wellness initiatives. Most policies also include a member rewards scheme that offers discounted gym memberships, fitness-tracking technology, and free coffee. Access to health insurance and wellness benefits can help to maintain productivity for staff working in physical roles.

Adding optional extras to your coverage lets you tailor your policy to your employees' needs. For example, you can invest in enhanced mental health coverage to access more counselling sessions, plus in-patient and out-patient treatment from psychologists and psychiatrists.

An Employee Assistance Programme (EAP)

An Employee Assistance Programme (EAP) can build on the coverage your health insurance already provides. EAPs provide access to 8-10 counselling or talking therapy sessions, allowing staff to self-refer when needed. EAPs also offer telephone helplines. Most include legal and financial guidance to help staff understand their rights. These services don't provide legal or financial advice but can signpost staff to other providers if needed.

Mental health first aid training

This isn't an employee benefit in the traditional sense, but it supplements your efforts to improve your team's mental well-being. Mental health first aider training teaches staff to recognise when a colleague may be struggling, or identify symptoms in themselves. They can then have supportive conversations or raise an issue with a manager to intervene and encourage their colleague to seek help. It's also worth appointing well-being champions to promote health and wellness initiatives or act as a focal point for information and guidance.

Flexible working hours

Flexible working helps employees reduce their stress levels and can improve job satisfaction. While working from home isn't an option for catering staff, flexible hours can be. Flexible scheduling lets workers request changes to their contracted hours and swap shifts with colleagues. Consider introducing digital scheduling via an app to streamline the process. Digital platforms let staff share their availability, pick up shifts that may be short-staffed, and swap shifts with others. It can also enable managers to ensure team members take adequate rest breaks to avoid physical illness or mental burnout.

Job satisfaction and career development support

High turnover can be a symptom of employees who don’t see hospitality as a long-term career, or students taking hospitality jobs because they fit around their studies. Several methods can help increase staff satisfaction and employee retention, and demonstrate the career growth opportunities available.

Structured training and development

When new employees join your company, they may not be aware of the training and development opportunities available. Providing training and information about potential career paths they could follow helps them see a future on your team. Offering apprenticeships and in-house training enables them to improve their skills, earn a qualification, or move into a role with a different skill set.

Work shadowing and mentorship programs let employees learn on the job and discover which roles appeal to them. A mentoring approach can increase employee satisfaction as staff feel valued and supported. It also helps to enhance service quality and reduce the number of mistakes new employees make.

Recognising good performance

Workers who feel valued provide better service, which can lead to more repeat business. While your employee benefits play a vital role, it can be a good idea to create a reward scheme to recognise excellent work. Employees could receive rewards based on customer feedback or nominations from their colleagues. Rewards could be financial or gift-based. You could also use feedback and rewards to nominate staff for places on career development schemes, depending on their goals.

In-house progression

We've mentioned the benefits of providing in-house training and development, but it's also worth encouraging workers to take on different roles within your company. For example, waiting staff could spend time in the kitchen, working as a pot washer or kitchen porter. New hires may not have the experience or knowledge to prepare food, but could shadow a chef or sous-chef to learn what the role involves. This encourages mobility but also helps employees understand how different roles fit together to achieve the end result.

If you have several sites, encouraging workers to work elsewhere lets them experience the difference the location can make. Staff who can see a clear path to career growth opportunities and promotion will often stay longer than those who don't.

Benefits supporting financial well-being

We've mentioned the financial difficulties restaurant employees can face due to unpredictable hours and earnings, especially when it comes to distributing tips. A fair salary is one of the most highly valued employee benefits and helps you attract top talent. You can help your team save money by providing free meals during shifts, as this directly cuts their living costs. Various other benefits can provide employees with more financial security.

Income protection insurance

Income protection insurance pays a percentage of an employee's salary if they're absent from work due to illness or injury. Policies can pay up to 80% of an employee's usual earnings for up to 2 years, while statutory sick pay only pays £123.25 per week for up to 28 weeks. Providing income protection insurance as an employee benefit means your staff can take time off to recover without worrying about paying the bills. This is particularly important for workers with physically demanding jobs who may experience a relapse if they return to work before they're ready.

Financial education

Financial education can help your team members make the most of their money and manage their income, particularly when income fluctuates with shift patterns and peak times. You can provide training in various ways. If you have a company pension scheme, invite the adviser to run a session on retirement savings and the options available with the scheme. You could also invite other third parties to give talks. A resource library with guides from reputable sources, such as financial institutions and charities, lets employees search for information that's relevant to their needs.

As we've mentioned, an EAP can also offer access to independent guidance.

Fair distribution of tips

Your customers may tip to thank your team for excellent service, or you may add a service charge to the bill. Ensuring you distribute tips fairly amongst staff helps to boost their income, particularly during busy times. The Employment (Allocation of Tips) Act 2023 states that you must pass on tips without deductions other than tax or National Insurance, and have a transparent policy to ensure everyone knows how tips are shared. This increases trust and job satisfaction among your employees.

Guaranteed minimum hours

Guaranteed minimum hours give staff a baseline income, so they know they'll have enough to pay their bills. Employees can then pick up additional shifts based on their availability or to earn more. The way this operates in practice varies depending on the type of contracts you offer. Full and part-time staff may have guaranteed contractual hours with the option to work overtime. However, you should still ensure you follow working time rules, limiting staff to a maximum of 48 hours per week and ensuring they have adequate rest days.

Legislative change aims to end exploitative zero-hour contracts, but you can still offer them to employees who need them. For example, a student working part-time may want to take a complete break during exams or holidays. You can still offer minimum hours at other times.

The hospitality industry thrives on outstanding service delivered by talented staff. Offering a high-quality employee benefits package benefits your business by reducing staff turnover and providing your team with the right support. At Globacare, we provide clients with tailored advice to help them invest in insurance policies that support comprehensive employee benefits. Contact us for a comparison quote today.

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