Roughly 36 million people have sought jobless aid in the two months since the coronavirus first forced businesses to close down or cut operations and shed workers, according to reports.
The nationwide unemployment rate was 14.7 percent in April, the highest since the Great Depression. Lines of people seeking food and other assistance get longer daily.
Although business owners sometimes are accused of putting profits over people in their quest to save their companies and jobs during the pandemic, some Galveston County business owners worked quietly behind the scenes to help those they had to furlough and fought to get them back to work.
Here are some of their stories:
With dining rooms still closed and restaurants across Texas forced to limit service to takeout and delivery only, Dennis Byrd devised a plan.
“Four weeks ago, I made a four-week commitment to put our people over profit,” said Byrd, who operates five venues, including The Spot restaurant, 3204 Seawall Blvd. in Galveston.
At the time, The Spot hadn’t been approved for the Paycheck Protection Program, which the feds rolled out as a lifeline to small businesses to cover payroll costs, among other expenses during the pandemic closures.
“When I made this commitment, our sales had just hit their lowest levels in 20 years,” Byrd said. “We had furloughed 170 of 200 team members, and we could only pay our vendors partial payments.”
When asked how he could sustain that, Byrd said: “We’ll figure it out, like we always do.”
In a campaign he calls “People Over Profit,” Byrd began hiring employees back. He paid them $15 an hour. Employees with more than 10 years of service earned $20 an hour. Two team members celebrated their 10th anniversaries and each of them received a $1,000 bonus, $100 for each year of service.
“We ‘adopted’ all of our graduates and paid them a $250 graduation bonus,” Byrd said.
Salaried team members earned a $500 “hazard pay” bonus.
In all this, Byrd didn’t pay himself, he said.
“My salary was zero because the success of my team is what’s most important,” he said.
Byrd, through the help of Moody Bank, eventually was able to receive a Payroll Protection Program loan, he said.
“Once we knew that we were approved for the PPP loan, we accelerated the campaign,” he said.
“The timing of approval allowed us to accelerate what we were doing, meaning we were able to bring back our team much more rapidly than we would have been able to do on our own.”
The restaurant reopened in early May at 25 percent capacity under state pandemic precautions.
Byrd has hired back 123 team members, bringing the employee count to 153, he said.
His vendors all have been paid in full, he said. Through the crisis, he’s paid out $371,000 to his team, he said.
And Byrd has extended the campaign for two more weeks, he said Wednesday.
“I have the greatest team and community in the world,” Byrd said. “Without my team and my community, there is no us.”
— Laura Elder
Mike Dean has seen a disaster or two, he said.
Dean owns Yaga’s Entertainment, Yaga’s Café/Tsunami, 2314 Strand St.; Float Pool & Patio Bar, 2828 Seawall Blvd.; BLVD Seafood, 2804 Ave. R 1/2; and Beerfoot Brewery, 2816 Ave. R 1/2 — all in Galveston.
Dean already had added six weeks of payroll to his financial plan after hard lessons from going through hurricanes Rita and Ike.
“It’s a fund built after Ike that I’ve never touched in our disaster savings,” Dean said. “Once I had to make the terrible decision to lay people off, I recognized I needed to save for these disasters — I just didn’t know it would be a virus. I’m going to pray we don’t have a hurricane because I no longer have any savings.”
COVID-19 forced him to furlough 132 of his 155 employees, he said.
Dean has yet to seek federal aid, but he was able to feed all furloughed staff for two weeks during the early days of the pandemic and then one day a week through May 1, he said.
“We kept any person who’d been with us for five years or longer — no matter the cost,” Dean said. “We had the luxury of the payroll savings to kind of wait and see what the outcome was going to be with the 23 employees we decided to keep.
“They were incredible and stepped up tremendously to the plate with whatever tasks were asked of them,” he said. “They’ve been so incredible.”
Now with new social distancing measures in place at most of his establishments, except for Float and Beerfoot, which are still closed under pandemic restrictions on bars, Dean was able to rehire 60 furloughed employees and negotiated with vendors and used disaster savings to keep afloat during the shutdown, he said.
“I’d suggest to any business to try and do your best to save every season because you never know what’s coming,” Dean said. “I’ll never forget the unity and toughness my employees have shown during this wildly, stressful and crazy time.”
— Angela Wilson
GALVESTON RESTAURANT GROUP
It was tough for Galveston Restaurant Group to furlough many of its employees because the team is considered a family, said Johnny Smecca, a principal in the company.
The company, with about 250 employees, owns seven popular restaurant concepts, including Taquilo’s Tex-Mex Cantina, 2101 Postoffice St.; Mario’s Seawall Italian Restaurant, 628 Seawall Blvd.; and Saltwater Grill, 2017 Postoffice St. The company had to furlough about 70 percent, or 175, of its employees, Smecca said.
“It was the first time I had witnessed someone crying,” Smecca said. “It was really very hard on me.”
Early on, the restaurant group helped with an effort by local and regional partners to give away about 150 boxes of eight meals to hospitality workers who’d lost their jobs or experienced cuts in hours.
The donations fed many Galveston Restaurant Group employees, though people who weren’t restaurant group employees were fed, too, Smecca said.
The donation days continued for several Fridays while restaurant dining rooms were closed and people couldn’t work, he said.
The restaurant group has been able to guarantee wages for its employees after receiving federal assistance through the Payroll Protection Program, Smecca said. The loan allowed the company to ensure people got paid, even though revenue was down, he said.
For tipped employees, the company averaged each worker’s 2019 wages and is ensuring employees are paid that at a minimum, Smecca said.
“We’re going to do it until we run out of the money,” Smecca said.
The group also helped the four employees living in company apartments above the restaurants by waiving rent for a few months, Smecca said.
As soon as the company could, it hired back its employees, he said.
“I bet you we’re probably 90 percent fully employed again,” Smecca said.
The only people not back at work are those who moved away to spend the lockdown with family or those who still have trouble finding child care, he said.
— Keri Heath
GAIDO’S SEAFOOD RESTAURANT
At Gaido’s Seafood Restaurant and Nick’s Kitchen and Beach Bar, sister restaurants at 3828 Seawall Blvd. in Galveston, owner Nick Gaido decided in mid-April to bring back all of his staff members and to give them a temporary raise.
When dining rooms were first shut down, Gaido furloughed about 80 of the restaurants’ 175 employees, he said.
“It was the right decision,” Gaido said. “But it wasn’t an easy decision.”
After being approved for a Payroll Protection Program loan, Gaido called in his entire staff to begin the process of deep-cleaning both properties. Every Gaido’s hourly employee earned $15 an hour during a four-week period that began on April 16 and ended this week, Gaido said.
Salaried employees were all paid bonuses they would have normally received for making sales and to “keep labor in line,” even though there had been no sales nor much labor to manage over the past two months, he said.
Normally, only a few hourly employees at the restaurants earn more than $15 an hour, Gaido said. Most waitstaff, bartenders and bussers make a low hourly wage and rely on tips from customers.
Gaido credited the federal relief for being able to pay his employees — and pay them more to get through a tough time.
“There’s absolutely no denying that without that assistance, we would not have been able to do that,” Gaido said.
“We didn’t have to pay them $15,” he said. “We didn’t have to bring them back; we didn’t have to pay managers four weeks of performance bonuses. We could have just left it as it was and trickled along. But we found it was a great opportunity to give a surge in pay to our employees that needed it.”
Many of his employees had not been able to sign up for unemployment benefits by the time he brought them them back to work, Gaido said.
Bringing all his employees back was well-timed, Gaido said. Days after the his entire staff walked back in the door, Texas began opening restaurant dining rooms at a limited capacity. The staff’s presence allowed the restaurants to plan and train for reopening, he said.
Despite operating at limited capacity, the restaurants had record sales on Mother’s Day, Gaido said.
— John Wayne Ferguson
RED RIVER CANTINA
For the Red River Cantina, 1911 E. Main St. in League City, keeping all its employees meant keeping enough business to need a full staff. To do that when all dining rooms were closed, management amped up marketing and curbside service, got creative with its products and temporarily sacrificed profitability, owners said.
“Our goal was just to keep the employees working,” manager Jim Molina said. “We knew the restaurant wasn’t going to make money. We just wanted to survive and pay the employees.”
After shutting the dining room March 17, Red River’s management team began devising ways to keep the restaurant working with to-go service alone. Something that quickly became apparent was the increased effectiveness of marketing, Molina said.
The restaurant began to offer new products — such as kits for customers to prepare the restaurant’s meals at home — in addition to its regular menu items, and then when to-go alcoholic beverages were allowed by the state, Red River’s curbside business really took off, Molina said.
“That weekend, everyone was so excited about margaritas to go,” he said.
Early on in the shutdown, the restaurant went completely to curbside service, which might have eased concerns among uneasy customers, Molina said.
“A lot of restaurants were still letting people come inside and order, but we stopped letting people in the building,” Molina said. “When people were still trying to figure it out, we were already like, ‘No guests in the building.’
“We were already transitioning to contact-free curbside where guests could order online and not have to touch anything or sign anything, and that was really appealing to the public,” he said.
Lowered prices also drove customers to the restaurants, Molina said.
“One of the big discounts was on the fajitas, and one of the things we’re known for is our fajitas,” Molina said. “So, when everybody saw us slash our prices on fajitas during this time, the community really responded, and it just grew from there.”
Molina has inquired about federal assistance to also help out the business, but he isn’t interested in any assistance that comes in the form of a loan, he said.
Now, even reduced to 25 percent capacity, dine-in sales have once again overtaken to-go sales, he said. On Wednesday, dine-in numbers surpassed take-out numbers for the first time since before the shutdown, Molina said.
“That’s a good sign,” Molina said. “You should have more dine-in sales than to-go.”
— James LaCombe