Chipotle was one of very few winners from Q1’s financial reports and the company’s momentum certainly didn’t start there. In fact, you’d have to go back to the second quarter of 2020 – the pandemic quarter, if you will – to find a negative same-store sales number.
The company’s engine has no doubt been churning at full speed of late, as evidenced by share prices jumping by nearly 75% since October alone. There are several factors pushing the company to new heights, including a sharpened focus on throughput and a prioritization of the employee proposition. For that latter piece, Chipotle has continuously evolved its benefits to include mental healthcare, expanded parental leave, tuition reimbursement, English as a Second Language classes, pet insurance, and more. Most recently, the company added a service that provides faster access to paychecks, as well as a matching contribution to 401(k) workers’ student loan repayments. This continuous evolution of benefits is informed by town hall meetings each quarter, a “pulse survey” every other year that goes out to all the company’s 120,000 employees, and a benefits department that is highly in touch with workers’ changing demands.
“We have great benefits, but what we want to make sure what we’re doing is talking to our employees,” Laurie Schalow, chief corporate affairs and food safety officer, said during a recent interview. “We ask them about our benefits – ‘what do you like? What are you using? What would you like to see?’ We have very unique benefits and not only for our employees, but also for the families of our employees. Extending those benefits has been very important to our employees.”
The student loan repayment benefit came from such conversations last fall during open enrollment, for instance. Schalow said Chipotle’s employees, 73% of whom are Gen Z, were telling the company “time and time again” that they were so focused paying off their college debt, they weren’t saving for their own retirement, or their future in general. Chipotle’s recent proposal to pursue a 50-to-1 stock split, expected to be approved this week, was also created with employees in mind. As the company’s shares have surged past $3,000, they’ve become harder to obtain.
“(The stock split) is going to make it more accessible for our employees, which is really important to us,” Schalow said.
In conjunction with the proposal, Chipotle also announced a special one-time equity grant for all restaurant general managers, as well as crew members with more than 20 years of experience. Chipotle’s evolving scope of benefits fits a broader trend in the restaurant space following the pandemic. Simply put, employees want more than just higher pay, they also want more benefits and they want purpose.
“Today, benefits are more important than ever and it’s not just your traditional benefits of health and medical, paid time off and sick leave. We have the benefit that we’re all company owned, so the 120,000 employees can tell us what they want. We want to offer those benefits not just to retain them, but attract new employees to come and stay,” Schalow said.
Perhaps it’s no surprise, then, that CEO Brian Niccol told analysts the company’s turnover rates are the lowest they’ve ever been. As Chipotle targets ambitious growth, including about 7,000 North American restaurants from about 3,500 now, Schalow said it will be imperative for the company to continue focusing on its culture from the top down.
“I think you keep it simple and stay focused – taking care of our employees, offering benefits, looking for enhancements in technology to make their jobs easier, providing them with opportunities for advancement and growth. With those new restaurants come tons of growth opportunities,” she said. “It’s important to have a great culture in your restaurant, that you're working together as a team, that you are fully staffed, that the teams feel supported.”
Contact Alicia Kelso at [email protected]
