Convinced employees would be less demanding if they shared an owner’s perspective, the proprietor of Florida’s Jaws Jumbo Burgers is putting his theory to the test. Known curmudgeon Darryl Gaddis announced this week that he intends to sell 30% of the units he subsequently opens to the staffs who will run them.
It's not a giveaway. To join what Gaddis is calling the Employee/Membership Co-Op Program, employees will pay an upfront fee of $1,500 and follow-up charges of $150 a month.
Gaddis said he expects the program to help in funding his ambitious expansion plans. But he indicated that the anticipated brake on wage rates is his primary motivation.
Gaddis, who made headlines last year with a vow to sell Jaws because of what he called workers’ lousy work ethic, expressed outrage that some areas of the country are eying minimum wages in the $15 to $20 range.
“Keep in mind these people have no restaurant work experience and are totally useless until trained,” Gaddis said in the announcement of his employee ownership plan. Plus, “the people who are proposing the $15-$20 an hour minimum wage do not own a business. They work for the government, are parasites on the taxpayer’s money and do not care about the consequences of their insane actions.”
He fears their lack of foresight will drive the cost of a combo meal at a limited-service place like Jaws to $30 or $40.
Gaddis is betting employee-owners will forego raises that could drive prices to that levelbecause it’s to their advantage.“The more money I make, the more money they make,” he said. In addition, “Co-op members will encourage their family members and children to work at the restaurants to protect their financial interest.”
Every fourth quarter, he said, the participants will get a share of the profits. They’ll also be provided with a standing 10% discount on purchases from Jaws.
Employees don’t have to join the ownership group to be hired. Conversely, customers and others not on its payroll can buy into the co-op, according to Gaddis.
Though he provided few details about the nuts and bots of the arrangement, Gaddis stressed that the set-up is not an employee stock ownership program. Rather, he said, the participants will be given a contract that entitles them to a share of profits in more of a direct-drive process.
The first Jaws was opened in 1985 in the Detroit suburb of Farmington Hills, Michigan where, according to Gaddis, it was a local favorite during its residence there. A combination of increased competition, the expiration of a 10-year lease and dismay with Michigan’s cold winters prompted a move to White House, Tennessee, in 2017.
Gaddis eventually moved the brand to Ocala, Florida, believing its movie and shark theme would prove popular in the resort area.
Jaws specializes in one-third-pound burgers served with freshly made fries in a style the brand said is similar to what consumers found at burger joints in the 1950s.
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