Pay Helps Keep Workers at Western Burger Chain

The In-N-Out burger chain stands out among fast-food companies by offering starting wages of $9.50 an hour. Those relatively high wages haven't hurt the company, which has loyal customers in three western states.

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And let's look ahead the next month, when voters will decide whether to raise the minimum wage in six states, including Arizona and Nevada. Lawmakers in California have already voted to raise the minimum wage at the first of the year, and this moves could affect workers in some fast food restaurants, although not one small chain that does operate in California and Arizona and Nevada. In-N-Out Burger already pays well above the minimum, and last month, the family-owned chain boosted its starting wage to $9.50 an hour.

NPR's Scott Horsley reports.

[Soundbite of In-N-Out Burger restaurant]

SCOTT HORSLEY: It's suppertime at In-N-Out restaurant number 128 in San Diego. Most tables are full, and cars are lined up six deep in the drive-thru. Feeding this crowd is labor intensive. A dozen people are in the kitchen, taking orders, grilling burgers and hand-chopping fresh potatoes for French fries.

Mr. CARL VAN FLEET (Executive Vice President, In-N-Out Burger):I know from the other side of the counter it sure looks like there's a lot of white shirts and red aprons and papers hats walking around there. But hopefully it doesn't look chaotic; maybe organized chaos or something.

HORSLEY: Executive vice president Carl Van Fleet says In-N-Out's starting wage, which is nearly $3 an hour more than some competitors in San Diego pay, gives the company first pick of the best workers in the business.

Mr. VAN FLEET: Well, we've been always been committed to paying our people better. Not just paying them better, but hopefully treating them better. We want them to treat our customers extra special, and one of the ways that we feel we can accomplish that is by paying better.

HORSLEY: Anthony Lopez(ph) started working about three months ago for an In-N-Out restaurant in Irvine, California, where he's a college student. Lopez makes more than he did at his old job at a law firm, but he says money isn't the only thing that sets In-N-Out apart.

Mr. ANTHONY LOPEZ (Employee, In-N-Out Burger): One thing out there, it wasn't really so much the wages they're paying; it's just the respect and everything I got. It was a lot more than I expected, so that's why I stayed and that's what's kept me there.

HORSLEY: Van Fleet says workers at the chain typically don't go in and out, so turnover is less than half the industry average. Patty Via(ph) started working for the chain when she was a college student, and she stayed on even after graduation.

Ms. PATTY VIA (Employee, In-N-Out Burger): (Unintelligible) because every time you move a level, you got higher pay, but you work twice as hard. They're paying you for that hard work; it's not easy work.

HORSLEY: Via now has nearly four years experience, and she usually works the grill or dressing hamburgers during busy periods. She's near the top of the hourly pay scale, at $13 an hour. As a full time worker, she also gets health benefits and a 401 K plan, and she's considering a career in management. Every one of the company's 202 managers started out peeling potatoes or working the counter. In-N-Out managers earn about $100,000 a year.

Although the family owned company doesn't release financial information, the trade journal QSR estimate sales of In-N-Out last year were $365 million, or about 1.8 million per restaurant. That's about the same as the average McDonald's sales, and higher than Burger King's, even though In-N-Out doesn't serve breakfast. QSR's editor says the 58-year-old chain is widely admired in the industry. And the company was even singled out for praise in Eric Schlosser's critical book, Fast Food Nation. Van Fleet says not having to answer the stockholders makes paying good wages a little easier.

Mr. VAN FLEET: We don't set out to be different. Actually, the funny thing is, we set out to be the same, the same as we've always been. One of the things that our customers tell us that they like about In-N-Out Burger is nothing ever changes.

HORSLEY: On their way out of the restaurant, a young couple stops to check out a display case with 1950s-style uniforms, the same kind In-N-Out workers still wear today. The chain has such a devoted following, some customers order their own uniforms as souvenirs. In-N-Out's management may set the pay scale, but the bottom of every paycheck carries a reminder: made possible by the customer.

SCOTT HORSLEY, NPR News, San Diego.

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