Starting next year, Sweetgreen managers will be eligible to earn more than $200,000 a year if they meet certain milestones set by the company. The new offering, which will be paid through a mix of base salary and equity, is intended to empower managers who contribute to the business’s success, and “[share] those wins with those that are driving it,” co-founder and CEO Jonathan Neman said.

Under the new incentive plan, Sweetgreen managers (known as “head coaches”) will see their base pay increase by up to 45% if they work at restaurants with higher sales volume. The company declined to specify how high sales need to be to meet this threshold.

When restaurants outperform their sales goals, managers will get a revenue share bonus from the upside, with the percentage increasing based on their tenure in the business. Managers can also continue to receive equity in the company based on their performance.

Base salary increases will go into effect in Q1 of 2027, while head coaches will start to receive bonuses based on store performance on a quarterly basis from Jan. 1, 2027, according to Sweetgreen.

How Sweetgreen is making the case for higher pay. Higher labor and related costs cut into Sweetgreen’s earnings for the quarter ending in June, accounting for 29% of revenue, up from 28% the year prior. Same-store sales and restaurant profits also declined that quarter compared to 2025. (Sweetgreen will report Q3 earnings on Nov. 5.)

Amid such economic pressures, Neman recognized that investing in additional compensation for managers “is definitely a bet.”

“But the data supports that if we’re able to attract, retain, and incentivize better head coaches, that they will drive higher sales and better margins,” he added. Neman noted that while Sweetgreen is investing some money upfront to raise managers’ base salaries, most of the investment is contingent on their stores meeting certain performance targets.

“Typically the company would take more of that upside. Now we’re sharing in that upside with our team, but…we think that’s a good trade,” he said.

Zoom out. Sweetgreen isn’t the first fast-casual chain to bet big on its managers. Chipotle announced in 2021 that workers in its highest general manager position could earn $100,000, on average, as it sought to hang onto workers in a tight labor market. The burrito business doesn’t appear to have taken a financial hit from this move, as its restaurant operating margins have stayed between 23% and 26% in recent years. More than 85% of general managers at Chipotle were promoted internally in 2025, according to its 2026 proxy statement.

Neman said Sweetgreen took inspiration from chains like In-N-Out Burger, which recently confirmed that store managers can earn more than $200,000 on average, and Raising Cane’s, which grants monthly bonuses to managers based on sales, and said in 2024 it paid managers up to $175,000 annually.

In addition to business performance, Sweetgreen will be looking at metrics like team member turnover, “head coach stability” (i.e. whether managers stay in their stores), quality and experience scores, and internal mobility to determine whether this incentive program is working, Neman said.

This report was originally published by HR Brew.