Before you drown your anxiety about the coronavirus in a bowl of Never Ending Pasta, consider this: in most states, the staff at Olive Garden does not receive paid sick leave. That means if anyone working at the restaurant feels sick, they could be forced to choose between staying home and paying their rent.
The Olive Garden is one of the restaurant brands operated by Darden. The company employs about 170,000 hourly restaurant employees across 1779 restaurants in the United States, making it one of the largest full-service restaurant operators in the country. Except where required by law, Darden does not provide any of its restaurant employees with paid sick leave. Currently, just 11 states and DC — along with a handful of cities — require employers to provide paid sick leave.
The Center for Disease Control's coronavirus guidelines recommends employers “actively encourage sick employees to stay home” and "ensure that your sick leave policies are flexible."
A manager at the Olive Garden in Falls Church, Virginia, told Popular Information that, despite the coronavirus outbreak, the company would not pay employees who call out sick for work. The manager instructed a server not to "engage in a conversation" with this reporter about Olive Garden's policy.
None of Darden's media representatives responded to an email from Popular Information. But Darden employees around the country were willing to share their experiences.
A server at the Indianapolis Yard House, another Darden restaurant chain, told Popular Information that restaurant staff "do not get paid sick leave" and get "written up" if they fail to call in sick at least two hours in advance. According to the Indianapolis-based server, since the coronavirus outbreak, the company sent out a message encouraging sick employees to stay home. But it has not offered to pay these employees for missing time. The server has observed many coworkers reporting to work sick because they could not afford to miss a shift.
An Olive Garden server reports that, at a North Dakota location, employees are "not allowed to stay home sick" unless they can find someone to cover their shift or produce a doctor's note. But many of the workers lack insurance to see a doctor. In December, the server says, several members of the staff worked with a persistent cough.
A former Olive Garden server in Arizona, who recently quit, also said there was no pay for missed shifts. Did the server observe people coming into work sick as a result?
All of the time. If you couldn't get your shift covered and called in sick, they would typically try to get you to come in anyways, and if you stayed home, you would lose shifts in the future.
An employee who worked in Kentucky at Cheddar's Scratch Kitchen, another Darden restaurant chain had a similar experience. "I remember times when people came in with flu, strep, common colds. Many times people wouldn’t go to the doctor because most of us didn’t have health insurance," the former employee said.
Lobbying to keep sick workers from getting paid
The lack of mandatory paid sick leave in the United States makes the country particularly vulnerable to disease outbreaks like coronavirus. "Studies show contagion can really be contained with paid sick leave. People cannot stay at home and self-isolate if they are going to risk their jobs by doing so,” Sherry Leiwant, co-president of A Better Balance, said.
A 2012 study found "the lack of workplace policies such as paid sick leave led to 5 [million] extra flu-like illnesses during the H1N1 swine flu outbreak of 2009." A 2018 study found that, in cities that implement mandatory paid sick leave, flu rates plummet by nearly 50%.
According to the latest data from the Bureau of Labor Statistics, 55% of workers in the "accommodation and food services" industry have no paid sick leave.
One reason why so many restaurant workers lack paid sick leave is that companies like Darden are spending millions to prevent the passage of paid sick leave laws. Even as the coronavirus spreads in the United States, Darden, Outback Steakhouse, McDonald's, and other large employers are lobbying for a Florida law that would block cities from implementing their own paid sick leave requirements.
The danger of short-term thinking
Darden's refusal to pay its employees for sick leave saves the company a few dollars in the short-term but could backfire. The company's own SEC filings cite "health concerns arising from food-related pandemics, outbreaks of flu viruses or other diseases" as a major risk factor for its business.
If a virus is transmitted by human contact, our employees or guests could become infected, or could choose, or be advised, to avoid gathering in public places, any of which could adversely affect our restaurant guest traffic and our ability to adequately staff our restaurants, receive deliveries on a timely basis or perform functions at the corporate level… Additionally, jurisdictions in which we have restaurants may impose mandatory closures, seek voluntary closures or impose restrictions on operations. Even if such measures are not implemented and a virus or other disease does not spread significantly, the perceived risk of infection or significant health risk may adversely affect our Business.
The financial risk is not theoretical. The company was forced to pay out a substantial settlement in 2011 when a worker with Hepatitis A allegedly exposed thousands of customers.
[A] server in a Fayetteville, North Carolina, Olive Garden worked while ill with Hepatitis A, potentially exposing thousands of customers. With Darden’s policy of not providing earned sick leave, and with the minimum wage for servers in North Carolina being $2.13, the server likely could not afford to take a day off despite her illness. The Cumberland County Health Department called in thousands of area diners to be tested for Hepatitis A. After several thousand of these consumers filed a class-action lawsuit, Darden settled the case by creating a $375,000 fund to compensate the consumers.
The company could certainly afford to provide its employees with paid sick leave. It already does so in 11 states and DC. In fiscal year 2019, the company brought in $8.5 billion in revenue. It had a total profit of over $782 million before taxes.
Darden did not have an issue improving the compensation and benefits of its CEO, Gene Lee. In 2018, Lee made $15.7 million, more than twice his 2017 salary. The deal included "a $1 million base salary, $2 million in bonuses and more than $12.3 million in stock option grants." Lee benefits package alone is worth $430,000 and includes "a company car, an executive physical, insurance, and reimbursements for financial counseling."
Lee's compensation was 871 times the median compensation for a Darden employee, which was $18,097.
Not all companies are leaving their paid sick leave policies unchanged during the coronavirus outbreak. Trader Joe's, which already offers employees paid leave, says managers will have the ability to authorize additional sick leave for any worker with a respiratory illness. (A union seeking to organize Trader Joe's says the new policy doesn't go far enough.)
Senator Patty Murray (D-WA) has proposed a more comprehensive solution. On Friday, she introduced legislation requiring "all employers" to "let workers earn 7 days of paid sick leave a year, and give them 14 paid sick days immediately in the event of a health emergency."
UPDATE (3/9, 8:15PM): About 10 hours after this piece was published Darden announced they would provide sick leave to all of their hourly restaurant employees.
Photo credit: Flickr, hattiesburgmemory
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