P. Terry's raises minimum wage for full-time employees to $15 an hour
Patrick Terry went to his executive team in August and asked them to crunch numbers and find a way to raise the minimum wage for full-time employees from $12 to $15 an hour, in order to thank them for their work during an unprecedented year, said P. Terry’s CEO Todd Coerver.
One-third of the company's approximately 900 employees (at 20 P. Terry’s locations, one Taco Ranch and the company’s commissary facility) work full time.
Patrick and Kathy Terry's employees at P. Terry's juggled home-schooled children, laid-off spouses, childcare and all of the challenges that became commonplace in 2020. Two times between the spring and summer, the Terrys offered a boost by giving all of their hourly employees $50 in cash and $50 gift cards to H-E-B.
Then, the wage change went into effect in January. P. Terry’s announced the new minimum wage at their locations this week.
“Our people from March to August (last year), it was just like a fire drill every day: changing mandates and requirements. It just sort of made us step back and really take stock of what our people on the frontlines had been going through,” Coerver told the American-Statesman on Tuesday.
The company tapped two sources to increase salaries. It raised the price of burgers by ten cents and fries and drinks by a nickel last fall. Coerver said P. Terry’s didn't receive public pushback. But those increases only accounted for about half of the revenue needed to raise the pay floor. Terry didn’t want to raise prices further and cut into the value proposition that he’s long considered one of the brand’s defining features, so the Terrys agreed to make up the other 50% of the pay raise from their own bottom line.
Coerver said that’s one of the benefits of being a family-owned business: You don’t have to run those decisions by a board or investors.
“All we had to do was appeal to the Terrys,” Coerver said.
Though P. Terry’s has done better than most locally owned restaurants during the pandemic, their profits were down in 2020 — but only in the single digits.
“We took a hit, but we felt very fortunate compared to the rest of the world,” Coerver said.
The company that was founded in 2005 with its trademark drive-thru location at South Lamar Boulevard and Barton Springs Road continued its growth in the challenging first year of the pandemic. P. Terry’s added five new locations, mostly in Austin, and about 250 employees.
Coerver said the company didn't lay off any employees due to the pandemic, with P. Terry’s instituting a policy of two weeks paid time off for any employee who tested positive for the coronavirus or had a household member who tested positive.
“We didn’t want anybody not being forthright with us because they knew they couldn’t go two weeks without pay, so we wanted to put a program in place that made them comfortable coming forward and being honest with us just to protect our population as well as we could.” Coerver said.
Coerver acknowledged the coincidence of P. Terry’s pay rate change coming at a time when the $15 minimum wage is under debate in Congress. But he said the company policy that has been under consideration for months reflects the Terrys' desire to take care of their employees. He hoped the Austin-based business can serve as an example for a way forward on a policy that he believes must change.
“I mean, $7.25 as a minimum wage is inhumane in my mind,” Coerver said, referring to state and federal standards. “I can’t imagine we’re even having this conversation still. Something’s gotta be done. And if we can help push that conversation forward and challenge the status quo on behalf of providing a livable wage, I feel like we’re just trying to do our small part.”