Economic challenges stemming from inflation and high gas costs are an “advantage” that could allow Applebee’s to pay employees less, an executive writes in a leaked email.
Wayne Pankratz, the executive director of operations for Applebees franchise, made the comments in an email uploaded to Reddi’s r/antiwork subreddit group on March 23.
“Everyone has heard that gas prices continue to rise. The advantage this has for us is that it will increase application flow and has the potential to lower our average wage,” Pankratz writes.
‘This benefits us’
Pankratz also acknowledged in his email that most of the workforce at Applebee’s lives paycheck to paycheck. As government stimulus money wanes, people relying on unemployment funds will be forced to find employment.
“Stimulus money is no more, supplemental unemployment is no more,” Pankratz wrote. “This benefits us as prices rise, people who were relying on unemployment money, simply will have less money to spend. It will force people back into the workforce.”
Pankratz also predicted an advantageous labor market shift in his email, saying that the wage war was about to end. Rather than maintaining increased wages, Pankratz suggested lowering salaries and then acknowledged that many of the employees at Applebee’s would need to work second jobs.
“Besides hiring employees in at a lower wage to decrease our labor (when able) make sure you have a pulse on the morale of your employees,” Pankratz wrote. “[….] Many will need to work more hours or get a second job. Do things to make sure you are the employer of choice. Get schedules completed early so they can plan their jobs around yours.”
Applebee’s did not immediately respond to Fortune’s request for comment.
Applebee’s backlash
The social media outcry against Pankratz’s sentiment has been tremendous, with thousands of people commenting on Reddit, and many Twitter users condemning Pankratz and declaring intentions to boycott the company.
“Just another example of corporate greed trying to squish the average worker to a bloody pulp. Good thing I have not and continue to not dine at @Applebees after getting food poisoning not once, but twice. This could be the nail in their coffin,” said one Twitter user, Flaxenberg, on Wednesday.
“Wayne Pankratz of @Applebees says that higher gas prices are great for business because most employees live check to check and hopefully they can start lowering wages,” said another Twitter user, Rob Gill, on Wednesday.
“Another reason to never set foot in an #Applebees ever again. This email, sent by director of operations Wayne Pankratz, acknowledges that paycheck to paycheck employees are struggling & celebrates gas prices/inflation as it would drive people to take a job at their ‘restaurant,’” another Twitter user Testa_Rossa wrote on Wednesday.
The higher prices debate
As Pankratz’s email illustrates, certain companies appear to be exploiting the recession for their own gain. Whether it’s from lowering employee wages or raising consumer prices, corporations are reporting record profit margins in the wake of the pandemic.
The CFOs of Unilever and Proctor and Gamble both admitted to raising the prices of their respective products in November of last year, with the P&G CFO Andre Shulten going as far as to say he felt good about the price hikes because consumers were not reacting badly, as reported by Business Insider.
There has been an ongoing debate on whether large companies are raising prices because they are facing increased costs and passing them on to the consumer, or simply because they can. Some critics have asserted that companies are exploiting inflation and raising their prices by choice versus true necessity. Democratic elected officials like Sen. Elizabeth Warren and Sen. Bernie Sanders champion this line of thinking.
“Corporate greed is Nike increasing its profit by 125% last year to $5.7 billion & blaming ‘inflation’ for a 10.5% price spike on a pair of expensive sneakers made by workers in Vietnam earning less than a buck an hour while Phil Knight became $26.7 billion richer in the pandemic,” Sanders tweeted on Mar. 20.
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