After several days of keeping its entire workforce on payroll after shutting down its restaurants, one of the city’s most prominent restaurant companies, Union Square Hospitality Group, is laying off about 2,000 employees, a restaurant spokesperson confirms to Eater. The layoffs, which represent 80 percent of the company’s total workforce at more than 20 restaurants, take effect immediately.
Hourly and salaried employees at both the restaurants and overarching corporate office have been laid off, the spokesperson tells Eater, due to a “near complete elimination of revenue” at the company. The staffers who remain are there to keep “basic corporate functions” operating, and executives at the company have voluntarily reduced their salaries. USHG will be absorbing all costs related to health insurance for all employees through mid-April.
When the restaurants reopen, staffers have been directed to re-apply for their jobs, according to information in an internal company email that was sent today. However, each former employee’s tenure and accrued paid time off will resume as if there wasn’t a layoff, and the company will waive the 90-day and one-year waiting period for access to health benefits and 401K benefits, respectively.
In addition, USHG founder Danny Meyer announced that he was forgoing all of his compensation and donating it to a relief fund for all USHG employees. Any revenue from purchases of USHG gift cards now through March 24 will also be donated to the relief fund. The goal is to rehire staffers later at the company’s restaurants, which include Union Square Cafe, Gramercy Tavern, the Modern, and popular casual cafe Daily Provisions.
Last Friday, the company had announced that it would be temporarily shutting down all of its restaurants in the midst of the new coronavirus crisis. USHG decided to forgo any delivery or takeout options at any of its restaurants, the spokesperson says, because the company “didn’t feel comfortable” continuing to operate with little clarity on whether it would be safe for their employees or customers to do so, given the dangers of COVID-19.
In deciding to lay off the majority of its staffers, USHG joins a slew of restaurants that have done the same this week. At this point, many restaurateurs are encouraging employees to file for unemployment to provide some financial relief while their workplaces are shut down for the foreseeable future.
In a statement to Eater, Meyer emphasized the need for government assistance — at the city, state, and federal level — in order to support restaurants and their workers. He pledged his “immediate service” to helping to come up with a “full emergency relief package” for restaurant and bar workers affected by the crisis.
“In the 35-year history of Union Square Hospitality Group, this is, without a doubt, the most challenging period any of us has ever encountered as leaders,” Meyer said in the statement.
In the past several days, the city’s unemployment website has been overwhelmed by people trying to file to receive benefits, and NYC Mayor Bill de Blasio reiterated at a press conference yesterday that “all businesses” will be expected to file taxes on time this week, despite repeated calls from industry groups to suspend tax payments as restaurants crater across the city.
This post has been updated with information about USHG job reapplication.