Thousands of Beaufort Co. restaurant workers now out of work due to coronavirus threat
Restaurant and bar owners around Beaufort County woke up to a new and grim reality on Wednesday.
So did nearly 15,000 employees who work in the accommodations and food service industry in Beaufort, Bluffton, Port Royal and on Hilton Head Island.
The afternoon before, South Carolina Gov. Henry McMaster ordered restaurants to close their dining rooms and offer only meals to go, rendering servers throughout the state useless.
“We’re going to be open until the governor tells us we can’t be or I have a ... heart attack,” Clayton Rollison, chef at Lucky Rooster Kitchen and Bar on Hilton Head, said. He was among those shifting their restaurants’ focus from fine dining to takeout and delivery.
At least one major restaurant group on Hilton Head Island announced its hourly employees would be placed on leave, and others were forced to lay off workers outright, though they had been in high demand only weeks ago.
How are restaurant workers being paid?
Large restaurant groups, especially on Hilton Head Island, are scrambling to make plans to keep their employees afloat.
Coastal Restaurants and Bars (CRAB), which owns Crazy Crab in Sea Pines and on Jarvis Creek, Reilley’s Grill and Bar, Aunt Chilada’s, Fishcamp on Hilton Head and in Port Royal and others, reported a 50% drop in business prior to the governor’s announcement Tuesday.
Now, workers there will receive one week’s pay and then be placed on leave, according to a letter given to employees Wednesday.
“Today is one of the hardest days as a leader of this company,” CRAB owner Brendan Reilley wrote. “We have obligations to our creditors and need to make sure we can fulfill those as well. We do not know how long this will last and need to make sure you all have a restaurant to come back to when it is over.”
Reilley said CRAB will assist employees in applying for unemployment benefits, but wrote “we do realize those benefits do not equal what you are accustomed to making.”
The Southeastern Entertainment Restaurant Group, or SERG, owns more than a dozen restaurants, including Skull Creek Dockside, Skull Creek Boathouse, Poseidon and Wise Guys. The group announced in a message to employees Tuesday that all employees would continue to be paid.
Employees will be paid $10 per hour for the average number of weekly hours employees worked from Feb. 12 through March 10.
For a server working 30 hours per week, the $300 paycheck will almost certainly be a decrease in take-home pay, but SERG partner Alan Wolf said in the message that workers can apply for S.C. Department of Employment and Workforce benefits even if they are getting paid by the restaurants.
Checks will be distributed to SERG employees by March 28, the announcement said.
Becoming takeout-only
All restaurants in the county are facing the reality of having guest-free dining rooms.
In Beaufort, a handful of restaurants have closed while many others continued to offer curbside service or local delivery.
The Beaufort Area Hospitality Association and tourism officials are keeping a list of the status of restaurants, hotels and other businesses throughout the effects of coronavirus.
The hospitality group is working to connect out-of-work restaurant employees with a local food pantry and other job opportunities, executive director Ashlee Houck said. The organization and tourism officials are pushing the curbside pickup options in an effort to keep restaurants afloat.
Beaufort has about 1,200 hospitality related jobs, with an annual payroll last year of $21 million.
The Hilton Head Island-Bluffton Chamber of Commerce also launched a similar list of businesses offering takeout, and island businesses were starting to change their focus Tuesday evening.
SERG Group launched deals on take-out, delivery and curbside pick-up for restaurants such as Skull Creek Dockside, The Black Marlin and Marley’s Shrimp & Burger Shack.
Java Burrito, a Hilton Head fast-casual Mexican restaurant, started takeout business on Tuesday evening by setting up a table at its entrance and side door and taking orders while guests waited outside to get food.
Nonprofit and hotel layoffs
Local nonprofit organizations and hotels are also cutting staffs.
The Boys & Girls Club Hilton Head Island laid off all its part-time workers — about 15 people.
Club director Kim Likins said the employees were notified via email on Tuesday afternoon.
The club serves about 750 children throughout the year, many of whom are the children of employees of the hospitality industry, Likins said.
The club’s upcoming major fundraising gala was canceled, she added. The decrease in funding has forced her to redo the club’s budget, and Likins said she feared the club would have to cut back on summer programming. The club is open more than 10 hours each summer day.
“This is going to hugely impact our service industry and the children we serve if we have to cut our hours and days in half,” Likins said.
At Holiday Inn and Suites on Boundary Street in Beaufort, operators haven’t eliminated positions but have scaled back staff as they normally do when occupancy is low, said Vimal Desai, chief operations and development officer with HMV Management.
April is typically the hotel’s busiest month of the year, with between $300,000 to $400,000 in business, he said.
As of Tuesday, the hotel had about $30,000 worth of reservations for April.
The slow period comes as the hotel is undergoing extensive renovations inside — an ideal time for the work but also another expense.
”We’ll be definitely running on bare minimum staff,” Desai said. “I’m hoping not to have to lay off any managers. If I have to, I have to — I obviously have a business to run.”
Statewide hotel occupancy rates were down by 5.4% in the first week of March, according to Dawn Dawson-House, director of communications for South Carolina Parks, Recreation and Tourism.
Dawson-House said her organization is preparing for another drop.
“Usually this time of year around March with spring break and (RBC) Heritage, we, especially on the coast, start moving into the 70% occupancy range,” she said. “Right now were hovering around 20%.”
Calls to the Marriott and Westin hotels on Hilton Head Island on Tuesday and Wednesday regarding their plans for staffing were not returned.
Effects on small businesses
Small businesses are struggling to adjust to the sudden downturn.
In Bluffton and Hilton Head, many restaurant managers and owners have been forced to change business hours and temporarily lay off staff, knowing they will likely have to weather months of drastically cut revenue.
Some potential relief for these businesses could come in the form of economic injury loans from the Small Business Administration, which are usually rolled out after disasters like hurricanes and floods.
The federal government will accept loan applications from small businesses in South Carolina for as much as $2 million as soon as Gov. McMaster authorizes it, which the agency estimates could happen as soon as Wednesday or Thursday.
In the Lowcountry, the Small Business Administration is anticipating businesses in its hardest hit industries — hospitality and tourism — to begin applying for loans.
“Right off the bat, I’m seeing that the hospitality and tourism industries are hurting. But it’s not just the hotel that needs help, it’s the support businesses too, like the IT company that services the hotel,” said William Furman, the senior area manager for the Small Business Administration who oversees the South Carolina coast.
Statewide, the agency is facing “constant calls” from businesses seeking relief, according to S.C. District Director Greg White.
For now, White said the agency is telling small businesses to apply for the loans, which have a 3.75% interest rate, when they’re ready and to cut expenses and save money.
The process to get an economic injury loan approved takes approximately 18 to 21 days, and the Small Business Administration estimates the money will be in the pockets of business owners within 30 days.
This story was originally published March 18, 2020 at 3:53 PM.
