(NEXSTAR) – Applebee’s is responding to backlash over a recent email from an executive working for one of its franchisees.
The executive, identified as Wayne Pankratz of American Franchise Capital, had sent an email to colleagues in which he claimed that rising gas prices and inflation were actually good for business. Pankratz’s thinking, as he explained to area managers, is that rising prices would force more people into the workforce, allowing Applebee’s to hire employees “at a lower wage” than it had before.
Pankratz explained:
“We are no longer competing with the government when it comes to hiring. Stimulus money is no more, supplemental unemployment is no more. This benefits us as prices rise, people … relying on unemployment money, simply will have less money to spend. It will force people back in to the work force.”
He added that some “mom and pop companies or smaller businesses” would likely fail under spiraling costs, sending more potential employees into the hiring pool.
“The advantage that this has for us is that it will increase application flow and has the potential to lower our average wage,” he wrote in the memo, which has since been leaked to Reddit and Twitter.
Pankratz also acknowledged that “most of our employee base and potential employee base live paycheck to paycheck,” and some “will need to work more hours or get a second job” to maintain their current standards of living.
“Do things to make sure you are the employer of choice,” he advised. “Get schedules completed early so they can plan their other jobs around yours. Most importantly, have the culture and environment that will attract people.”
American Franchise Capital (AFC) owns over 100 restaurants in the Midwest, including both Applebee’s and Taco Bell locations, according to The Kansas City Star. Pankratz’s profile on LinkedIn, where he’s described as an executive director of operations at Applebee’s, had been taken down this week.
Kevin Carroll, the chief operations officer of Applebee’s, appeared to confirm the legitimacy of the email in a statement shared with Nexstar, but said the opinions presented by the memo’s author were not in line with the company’s own.
“This is the opinion of an individual, not Applebee’s,” wrote Carroll. “This issue is being addressed internally by the franchisee who employs this individual and who owns and operates the restaurants in this market. Our team members are the lifeblood of our restaurants, and our franchisees are always looking to reward and incentivize team members, new and current, to remain within the Applebee’s family.”
A representative for AFC added that Pankratz “doesn’t have the authority to create policy for our company for the brand or anything,” and suggested that “maybe he wrote it in the middle of the night.”
“The main message here is that this in absolutely no way, shape, or form speaks to our policies or our culture, or anything like that with our brand,” the spokesperson told the Kansas City Star.
Despite the statements from Applebee’s and AFC, saying it would be addressing the issue, the leaked email has already left a sour taste in customers’ mouths.
“Imagine celebrating that your employees don’t make enough to live and being overjoyed that you’ll be able to pay them *even less* because now they are more desperate. Sickening,” wrote one LinkedIn user.
“I’m thankful so many restaurants are showing us they are run by absolute trash people. I order take-out about 90% less than I used to, have blacklisted many stores, & both my wallet & health have improved,” another Twitter user said.
Workers, naturally, were also offended by the email, which resulted in three managers at an Applebee’s in Lawrence, Kansas, quitting their jobs, a worker told the Lawrence Journal-World. The restaurant was temporarily closed on Tuesday.