California restaurant owner says furloughed employees won’t come back to work because they’re making $1,000 a week in unemployment

Owners of full-service restaurants and bars have been anxiously waiting to resume serving diners inside their venues ever since the first wave of stay-at-home orders began in mid-March.

As of Monday, dine-in restrictions have been lifted for nearly 192,000 restaurants, according to a census released this week by market research firm The NPD Group. 

In California, restaurant owners like Mario Marovic have been waiting the longest.

California Gov. Gavin Newsom, who leads the country’s most populous state, enacted his stay-at-home order on March 19 – the earliest of any state. On May 8, Newsom began easing business restrictions by allowing retailers such as florists and clothing shops to open for curbside pickup. 

Photo credit: Alan de Herrera

Photo: Mario Marovic, who owns 11 restaurants and bars in Orange County, Calif., says he’s ready to reopen his venues but he’s having trouble rehiring furloughed workers.

Still, there’s no firm date on when Marovic can reopen his 11 bars and restaurants, all located in prominent gathering spots in Orange County, Calif. Some have been open for takeout. Others have been temporarily closed.

“It’s just a waiting game,” Marovic told Restaurant Hospitality during a Zoom video chat last week.

In the meantime, Marovic, owner of the Lounge Group, has been doing his homework. He’s outlined safety procedures and layouts for how each restaurant will operate in a post-COVID-19 world.  At a mock dinner, he and his team tested everything from how to safely give diners utensils to processing checks with minimal contact. 

He’s got an operational plan, but he’s having one major problem: rehiring employees.

Marovic, whose string of venues are known for their sophisticated atmosphere, menus and cocktails, was forced to furlough about 470 employees several weeks ago. He’s kept about 80 workers on the payroll to support restaurants open for takeout. 

After receiving federal relief under the Paycheck Protection Program, he was excited to welcome back furloughed workers. But to his surprise, many did not want to come back.

“It has nothing to do with the [fears of] coronavirus,” said Marovic. “Some people are enjoying the unemployment benefits.”

In California, unemployment compensation normally caps at about $450 a week. But, under the federally funded Pandemic Emergency Unemployment Compensation program, workers impacted by COVID-19 get an additional $600 a week. 

Most of Marovic’s restaurants have received a Paycheck Protection Program loan. For the loan to be forgivable, he must use 75% of the funds on payroll. He’s concerned he might not meet that criteria if he can’t convince staffers to come back.

Marovic, who is also an Orange County landlord, talks about this dilemma and other COVID-19 challenges in our Zoom chat. His establishments: Matador Cantina y Cocina, 2J’s Lounge (Fullerton); The District Lounge (Old Towne Orange); The Country Club, Playa Mesa, Wild Goose Tavern (Costa Mesa); and Malarky’s Irish Pub, Helmsman Alehouse, Stag Bar Kitchen, Dory Deli and Blackie’s by the Sea (Newport Beach.) 

Watch/Listen to our conversation.

This is part of our Stories from the Front Lines series.

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Contact Nancy Luna at [email protected]

Follow her on Twitter: @fastfoodmaven