Developer bringing Johnny Rockets chain to B.C. offers $15 starting wage
CEO says guaranteeing a living wage is one way to attract premier employees
A Victoria-based restaurant developer is sparking a new round of discussion over a $15-per-hour minimum wage, setting that as the starting pay for employees as he prepares to launch the popular Johnny Rockets fast food franchise in British Columbia.
“This was our purpose before profit,” said Lewis Gelmon, CEO of JR Canada Restaurant Group Ltd. “It’s what we want to be known for among employees. We want to keep them around.”
“And no tipping,” he said. Gelmon secured the Canadian rights to the California-based Johnny Rockets brand in Canada in 2015 and started by “reverse engineering” its business plan to offer higher wages at the outset as “good business.”
The first round will see Gelmon’s staff open three locations this year, one in Victoria’s Bay Centre to be open by the end of the month, and two in Vancouver, one at Nelson and Howe to open by August and another at Broadway and Cambie to open by the end of the year.
Gelmon read about the call for a $15 minimum wage, which started among fast-food workers in cities in the United States, and besides deciding it was the right thing to do, figured he would attract employees who would be better committed to product quality and customer service.
“It really comes down to recognizing that this is as important component of your operations as anything else, what you pay your staff,” Gelmon said. “It shouldn’t be an afterthought.”
Above entry-level staff, Gelmon said he plans to pay “team-lead” employees $17 to $18 per hour and general managers more than $20, plus benefits. (Entry-level employees will have an option to earn half benefits.)
Places such as Seattle, California and Alberta have set courses toward setting $15 as a minimum wage, but the concept has proved contentious in B.C. where there is a strong push from the labour movement, though government has resisted.
B.C.’s last big boost was in 2011 when the province raised the minimum wage to $10.25 per hour ($9 for restaurant servers who serve alcohol) from $8 and subsequently promised to increase it along with inflation. It is set to get a 50-cent boost in September, putting it at $11.35 ($10.10 for liquor servers).
The province’s main food-service industry group remains wary of that $15 minimum wage, although B.C. Restaurant and Food Service Association CEO Ian Tostenson recognizes higher wages might be a necessity to attract employees to launch a new concept.
B.C. restaurants are suffering a shortage of kitchen staff, which is naturally pushing up wages restaurants have to offer, Tostenson said.
However, he argued a blanket 40 per cent increase would be too big a jump for a lot of his independent members, who operate on razorthin profit margins, to try to pass on in higher prices. They would be more likely to try cutting staff to reduce costs.
B.C. Federation of Labour president Irene Lanzinger doesn’t buy the industry’s push back, arguing government needs to “raise the bar” for everyone, including large chain restaurants, and the industry would get a payback from betterpaid workers who will spend their increased wages in the community.
“I applaud them,” Lanzinger said of JR Canada Restaurant. “I think they will get a big lineup of (applicants).”
Gelmon acknowledged he has an advantage because he was able to negotiate a favourable royalty rate with the Johnny Rockets parent company and secure rent deals with landlords that work for his plan.
“Not everybody can start fresh like we did, I respect that,” Gelmon said.