Economy Ruth's Chris received bailout then furloughed employees while paying mgnt and execs

[OverCoronavirus Pressure]

Technically correct is the best kind of correct.

 

[panamaican]

How can they retain hourly employees if they're not allowed to be open? How would they operate an empty restaurant? Looks to me like it's retaining key staff they need to keep right now.

Uhm...that's the point of the money. To pay your staff even though you're not operating your business. That's why the loan is forgiven if you spend 75% of the money on payroll and operating costs. It's precisely for businesses like restaurants who must layoff employees because they're not generating income. The PPP is meant to keep those employees from being laid off and keep the business capable of meeting overhead like rent.

Corporate headquarters employees aren't at high risk of being laid off because of restaurant closures. It's the wait staff, line order cooks, hosts, etc. that bear the risk of loss. Especially since the corporate headquarters usually has access to lines of credit or fiscal reserves that the lower end businesses do not.

If you want to go with a big business, you might think about a custom furniture company with a 100 employees that would see their orders dry up as a result. The employees on the manufacturing floor need to be retained in anticipation of the business reopening but the employer can't pay them if his orders can't be fulfilled so he needs the money to keep his staff on payroll as long as possible.

Ruth Chris HQ is not the intended recipient of this initiative, it's the Ruth Chris restaurants. And this wouldn't be a problem if it was an open ended fund. But it's limited in availability so every dollar poorly allocated is 2x as bad because it's going where it's not needed and those businesses in need are going to go under from lack of access.

 

[brackis1]

They only gave it back after the story broke about how big corporations were snapping up the money and small businesses didn't get any. Next thing you know...Shake Shack is giving back their money.

They're a 2 billion dollar company that was fishing for a 10 million dollar loan. They gave it back because they thought the PR or returning the loan would be worth more than the loan.
Which turned out to be true considering their stock popped about 80 million in value today alone. I would know; I flipped a thousand shares during a pump up CNBC interview.

This board is for chess too, not just checkers.

 

[panamaican]

They're a 2 billion dollar company that was fishing for a 10 million dollar loan. They gave it back because they thought the PR or returning the loan would be worth more than the loan.
Why turned out to be true considering their stock popped about 80 million in value today alone.

This board is for chess too, not just checkers.

I agree that it was PR to give it back. The PR gain isn't just about looking good for giving it back, it's also to prevent the PR hit that Ruth Chris is getting. But they wouldn't have given it back if scrutiny hadn't geared up over which companies received the funds. They would have kept the $10 million and kept on keeping on.

 

[brackis1]

I agree that it was PR to give it back. The PR gain isn't just about looking good for giving it back, it's also to prevent the PR hit that Ruth Chris is getting. But they wouldn't have given it back if scrutiny hadn't geared up over which companies received the funds. They would have kept the $10 million and kept on keeping on.

The PR hit they're taking is regarding who within the company got the pay, not the act of taking a loan.
Different PR scenarios.

 

[OverCoronavirus Pressure]

I agree that it was PR to give it back. The PR gain isn't just about looking good for giving it back, it's also to prevent the PR hit that Ruth Chris is getting. But they wouldn't have given it back if scrutiny hadn't geared up over which companies received the funds. They would have kept the $10 million and kept on keeping on.

It's a lock that they wouldn't have given it back unless they absolutely had to.

 

[Hadron90]

And on the other side, Shake Shack returned the bailout money they received. Be like Shake Shack.

What does that even mean? Its not like companies just got stimulus checks like people did. The money was made available through low interest loans. So they got a loan, then immediately paid it back?

 

[panamaican]

The PR hit they're taking is regarding who within the company got the pay, not the act of taking a loan.
Different PR scenarios.

But if scrutiny over the loan recipients had not turned up, they would not have given back the money. Who within the company is still "who got the money" and that's where the scrutiny is directed, which companies, which employees.

 

[7437]

How can they retain hourly employees if they're not allowed to be open? How would they operate an empty restaurant? Looks to me like it's retaining key staff they need to keep right now.

By taking a government bailout to retain hourly employees.

That seemed pretty fucking obvious.

 

[7437]

I hope the justice department comes back on bailout abusers.

Cant stop them doing it. Can get them afterwards though.

Have you seen who is running the justice department? That isnt gonna happen

 

[Hadron90]

I don't really get the outrage, am I missing something. The employees are furloughed because the state ordered them closed. That's what unemployment is for.
I don't know for sure, but I'm guess that management and executives are still working, which is why they are still getting a salary.

 

[tenniswhiz]

In regards to the CEO, the company pays her $650,000. She apparently makes the rest through investment. It's just a pet peeve of mine when people argue investment returns as salary.

$650,000?
Wow, her salary is so much higher than Jeff Bezos’s salary!

 

[tenniswhiz]

In regards to the CEO, the company pays her $650,000. She apparently makes the rest through investment. It's just a pet peeve of mine when people argue investment returns as salary.

$650,000?
Wow, her salary is so much higher than Jeff Bezos’s salary!

 

[HARRISON_3]

This thread makes me hungry.

 

[Graves The Elder]

overpriced undercooked steaks.

I can do that at home.

 

[ElKarlo]

Shake shack took PPP money. In both these cases the govt should come down on them, hard. People gaming the system should be punished. That's my problem with the Republican party, they don't punish these guys and want the system to take care of its self, somehow.

 

[ElKarlo]

And on the other side, Shake Shack returned the bailout money they received. Be like Shake Shack.

Only because they got busted for it. They applied for small business loans. Which are essentially a grant. Shake shack has access to capital markets unlike most small businesses. They got caught being the adult trick or treating. Don't be like shake shack

 

[Chesten_Hesten]

Have you seen who is running the justice department? That isnt gonna happen

I follow their twitter, they post quit a few cases. They seem to be doing more than people think.

https://mobile.twitter.com/TheJusticeDept?ref_src=twsrc^google|twcamp^serp|twgr^author

 

[vengeful]

In regards to the CEO, the company pays her $650,000. She apparently makes the rest through investment. It's just a pet peeve of mine when people argue investment returns as salary.

So she makes nearly ten times as much while having to pay 45% less taxes on it than if it were all salary? Yeah, major difference!