Cost Control and Purchasing, Week 4 Discussion Forum 1 help

Part 1: Primary Response

Within the Discussion Forum area, 100 – 150 words that respond to the following questions with your thoughts, ideas, and comments. This will be the foundation for future discussions by your classmates. Be substantive and clear, and use examples to reinforce your ideas.

Labor is considered a semi variable cost because it has a fixed component (salaried employees), as well as a variable component (hourly employees). Often however, the terms labor cost and payroll costs are used interchangeably in the restaurant and foodservice industry. They are, in reality, two different things. Payroll cost is the total of employees’ salaries. Labor cost, as expressed on the income statement, is all-inclusive and includes the employer’s contribution to FICA and Medicare, workers’ compensation insurance, and employee benefits as well as wages.

Managers today have found that hourly employees need a reliability of guaranteed income to remain committed to a company.  Therefore managers in the hospitality industry must decide which positions should be salaried and which should be hourly while keeping in mind the continuous employee commitment to availability. 

Choose one of the following methods to assist with your paper submission.

  Choice #1

From a FOH (Front of the House) or BOH (Back of the House) position:

• Identify 3 positions that would be considered full time and 3 positions considered part time.
• Identify the benefits each position offers and how it supports employment reliability to both the employee and employer.
• Identify any disadvantages each position may offer to both the employee and employer.

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