Business Owners Have 'A Special Challenge' To Help Working Families

Business leaders and policymakers gathered at the White House to discuss how working families can get ahead. One participant explains how he feels companies can stay competitive and help families.

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MICHEL MARTIN, HOST:

Now we'd like to hear from one of the panelists at this week's White House summit on working families. The event focused on ways that businesses can support the needs of working families. Andy Shallal is the owner of the Washington D.C.-based restaurant chain Busboys and Poets. It's a gathering place, not just for people who want to eat, but also for artists and people who are involved in politics. We've been talking to him from time to time over the years about how he's faring as a small-business owner in these challenging economic times. Andy Shallal, welcome back to the program. Thanks for joining us.

ANDY SHALLAL: Thank you so much, Michel.

MARTIN: Why do you think you were selected to be part of this conference?

SHALLAL: You know, I own a group of businesses, and I think I am in an industry that is a little bit difficult, in a sense of how it's coming into this idea of improving conditions for workers. So there are over 10 million people that are involved in tipped wages in the restaurant industry. And so it opens up this new dialogue that we've been having about increasing the minimum wage, increasing the tip wage and changing the paradigm of how restaurants have been run. For years, restaurants have been basically the last to come into this professionalism of an industry, and I think that's why I was brought in.

MARTIN: Well, also you're at the cutting-edge of one of a more intense debates that we've been having both between the political parties and people with different philosophies about the best way to assist families. I mean, I think most people know that wages have been stagnant for, you know, quite some time in this country now. And a lot of people have been pushing for an increase in the minimum wage. As you know, the restaurant workers - the tipped minimum wage is a lot lower than the regular minimum wage. What's your philosophy on that?

SHALLAL: Well, you know, the restaurant industry employs a lot of minimum wage and tip wage workers. So we have to address that issue if we want to raise the votes for everybody. So I was brought into it because I've been in that conversation about raising the minimum wage. We started with the idea of the national minimum wage we have, which is $7.25 an hour - It's $8.25 an hour her in D.C. - was not enough to make any kind of a living. So if you go to work full-time, you should be able to, at least, feed your family, have a roof over your head and be able to go to and from work. That's the basics. Unfortunately, with that kind of a wage, it's impossible in this city or in any city really, for that matter. So we start looking at other ways. People talk about a living wage. Living wage is hard to talk about because I don't know what that means. Is it an amount of money that somebody needs to make to raise a family of four. Everybody has different needs, and a living wage to someone may mean something totally different to somebody else.

MARTIN: So how much do you pay?

SHALLAL: We started at $10.25 an hour, and now we're raising it to $11.50 hour this year. Now the D.C. Council has raised the minimum wage. By 2016, it should be up to $11.50. There's also a push to try to push it higher, but the tip wage has never been really talked about because in this city, the tip wage is not such a problem. When people think of the tip wage, which is only, I think, $2.77 an hour here. In this city, that's not how much someone is making. They're making the difference between $2.77 and the minimum wage, at the very least.

MARTIN: So I think - what I'm guessing is part of the reason you were brought in to participate is that you are a business owner. A lot of the argument has been that business owners hate this idea of raising the minimum wage. You're asking them to bear the full cost of the difficulties in the economy right now. It'll kill business. Your business is growing. I assume part of your testimony is - you've got how many restaurants now?

SHALLAL: We have five, actually - we employ over 500 employees...

MARTIN: And your growing. You've been adding...

SHALLAL: We'll be adding 200 more employees this year.

MARTIN: Obviously, you're in conversation with lots of other small business people. Do they like your perspective on this? Do they like you speaking out about this or?

SHALLAL: Change is hard to come by. So when people have been used to certain paradigm, a certain structure, you know, it's really hard to change that. You know, when a small business owner opens a business the last thing you think about is your employees, frankly. When you're opening a small business - let's say you open a small restaurant here - small family business - you're worried about permitting. You're worried about construction. You're worried about finding money to be able to build the business. You're worried about the menu. You - so you set up all of these things, and then in the end you say, oop - well, we need to have people. We need to have a dishwasher. We need to have a waiter. We need to have a cook. We need to have people like that to be able to work. And so you look next-door, and you see - what are they doing next-door? OK. So they pay their dishwashers this much. That must be the prevailing wage. That's what I'll offer. And so there's no real understanding of how you can begin with saying, how can we make it good for the employee to be in - because ultimately, they're the ones that are going to make you succeed. So if you begin with that, then you change all your structures along that. So you'll change your menu prices. Now, we're talking about menu prices that may be tweaked just a little bit to be able to give somebody a higher wage. It's not like you're going to raise the price of a burger by double.

MARTIN: Can I ask you - what do you think is the value of a summit like this? I mean, we're spending some time today talking about - we just spoke earlier with Senator Tim Scott, who's participating in another summit about, you know, American business and the economy and - what - is there a value to these kinds of get-togethers? I mean, some people think these are basically kind of a PR stunt for whatever entity is sponsoring them - to be nice to their friends - to showcase people who agree with them politically and things like that. I mean, do you - what's the value to you participating in something like this?

SHALLAL: Well, to me, it felt like a pep rally. I mean, if anybody's ever played sports - a pep rally's very important to get the team on board to get everybody kind of excited about something. So it really did feel like a pep rally. And also, to be in business and to be around a lot of business people that are all doing the same, there's a lot of peer pressure to move this ball forward. So I think there's a huge amount of value in having lots of people come together on a sort of a joint effort, and they start pushing each other to go to the next level. That's a good thing.

MARTIN: Did you find it helpful in any way? Is there something you learned as part of participating in this experience that you might not otherwise have known or somebody that you would have met that you would not have otherwise met?

SHALLAL: Well, that I'm not alone in this - that there's a lot of people that are very successful that have done really well, that have offered much better situations and benefits than we even we offer. There are companies that have no sick leave or vacation policies, and I'm trying to understand what that is -where people just take off whenever they want to, come to work when they want to as long as they get the job done. Now, in some industries, that's very possible. In my industry, it's much more challenging - in a restaurant business because there's a lunch hour, and there's a dinner hour, and people come to eat during certain specific times. You can't just postpone, you know, the dining time until later. So we have a special challenge, and I think if we can raise the standards of the restaurant industry, I think it will make a huge impact on the whole economy in this country.

MARTIN: Andy Shallal is owner of the Busboys and Poets restaurant chain. It's based in Washington, D.C. area. He was kind enough to stop by our Washington, D.C. studios. Thanks so much for speaking with us.

SHALLAL: It was my pleasure. Thank you.

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