As COVID-19 wreaks havoc across the globe, the practical implications of stemming the global pandemic in Delaware have quickly translated into significant pain and suffering for the restaurant industry and their employees.
Yesterday’s decision by the state – following updated CDC guidance on limiting non-essential large gatherings – effectively closing most restaurants and bars has been a traumatic blow to businesses up and down the state.
“We’re devastated,” said Carl Georigi, whose Platinum Dining Group includes popular local eateries like Capers and Lemons, Taverna and Eclipse.
“I had to lay off 400 employees yesterday. To no fault of theirs or mine. Our government told us to close so we had to.”
Georigi said the restaurant industry is the state’s largest, employing 30-50,000 people in restaurants, fast-food spots, cafes, hotels and casinos. He expressed concern about many who are living “week-to-week” on paychecks that will not be coming again soon. Georigi said the process for impacted employees getting access to unemployment benefits quickly is not yet clear.
“All of our employees are filing for unemployment. Every single one,” said Georigi. However, those employees who tried to file today were kicked out of the system and told to try again on Sunday.
His frustration and fear were echoed by Xavier Teixido, a longtime local restaurateur and owner of Kid Shelleen’s and Harry’s Savoy Grill. The industry veteran said he was brought to tears walking out of his restaurants yesterday.
“I kind of feel like we’re being asked to take one for the team for the benefit of the public good,” said Teixido. “Right? We get it. But then we’re being asked to fend for ourselves.”
“Eight weeks is just an unbelievable period of time to have zero revenue,” he said.
Georigi and Teixido both said they needed better information to share with employees about how to navigate the impending hardship.
“We need a plan. We’re just desperate to be able to communicate with our employees about what they can do. You know, we have some ideas,” said Teixido.
Those ideas include:
• Making unemployment benefits available immediately without a waiting period
• Raising the unemployment compensation cap for management and other staff
• Securing a different unemployment benefit rating for tipped employees, who make much more than minimum wage at restaurants like Harry’s Hospitality Group and Platinum Dining Group
• Allowing former restaurant employees to work incrementally (with sporadic opportunities, for example, at a restaurant) without risking their unemployment benefits
Georigi, who is vice chairman of the Delaware Restaurant Association, said he felt the restaurant industry will bear the brunt of a public health decree that allows gas stations, convenience stores and retailers to stay open.
“I think if you’re going mandate quarantines and mandate closings it should be for everyone. Don’t just pick on restaurants. Why aren’t the Wawas closed? People exchanging money and credit cards all day long buying coffee. Why aren’t the department stores closed? Why aren’t the malls closed? Why pick on the restaurant industry? If you’re going to do it for social and safety reasons, do it across the board,” said Georigi.
Yesterday’s decree allows restaurants to continue to provide take out and pick up meal service, but Georigi and Teixido are taking different approaches based on their underlying business operations.
Teixido said his restaurants were “giving it a go” for a time but it will only sustain a fraction of his staff and he knows it will not be profitable. Georigi said it just wasn’t practical to scale the operation across his six restaurants.
“Right now we’re formulating a take-out plan for Harry’s that will be operational tomorrow night,” said Teixido. “And depending on the success of it, it’s a trial balloon, really. We’ll do some takeout but we know it won’t be economically profitable. But will it keep our lights on or at least keep us in the building? Kid Shelleen’s ordering is operational now.”
When asked how he would decide who would work and who would not under the new limited-service routine, Teixido basically summed up all of the people he just had to lay off. “Well, it’s not that hard because I can’t use waitresses. Our liquor license is suspended, so there’s no bartenders. I don’t need a busboy because there’s no dining room. I don’t need dishwashers because there’s no dishes to wash. I don’t need a lot of people at work,” he said.
Echoing comments made yesterday by BBC Tavern and Grill’s Dave Dietz, Teixido said another important part of his restaurant’s business is hosting events.
“Our event business is absolutely devastated. We have a ballroom – everything from weddings, to events, to corporate events – everything was canceled two weeks ago, everything on our books. So that has been really harmful. That’s almost like a whole separate business. If you’re a caterer, you’re out of business.
“We’ve been asked to take the hit, and somehow we need to be compensated for this,” says Teixido. “Takeout and buying gift cards aren’t going to make anybody whole — not even close if your business is full-service dining. Because the other thing is, we use liquor and beverage sales to help offset some of the high expenses that go towards cooking and serving food.”
Georigi said if the crisis extended beyond a matter of weeks, many restaurants would not be able to recover. “If this is a prolonged closure, some restaurants will simply not make it.”
Platinum Dining Group and Harry’s Hospitality Group also accepted perishable food deliveries the very day they were given four hours to close. Certainly, not all of the food delivered to Harry’s Hospitality Group will be consumed. But Kid Shelleen’s does have a take-out business, and Harry’s Savoy’s take-out service will be operational by tomorrow.
But Georigi can’t use the food he purchased for his six restaurants. “We asked all of our prep cooks and dishwashers to just come in this morning and take the food for their families. But when they came in, they all rolled up their sleeves to help with everything we need to do to close a restaurant. That’s just the way they are — hard-working even in the most difficult of times,” said Georigi.