What started as an anonymous Beer Advocate post alleging some shady business practices going on at Boston’s Trillium Brewing spiraled into a national PR blunder. These allegations included spiking beer with liquor and calling it barrel-aged (which is illegal), knowingly selling low quality beer (filling growlers with trub kegs) and cutting hourly wages. Trillium Owners JC and Esther Tetreault deny those first two claims (this post on the Takeout nicely sums up the implications of those claims if true), but they do admit to an awkward wage cutting scenario where (from our post two weeks ago):
Former and current employees say many workers were forced to reapply for their jobs — the same positions they had been working — with the main purpose being reducing their hourly wage from $8 an hour to $5 an hour.
The Tetreaults say the wage change specifically affected two retail employees because they were being paid the same as regularly tipped staff like bartenders, but receiving hardly any tips because customers don’t think of the retail counter as a tipping service. Trillium pretty quickly reinstated the previous wage structure after the bad press, we updated our post and we figured that was that. But last week, the Tetreaults did an impressive thing: They announced some dramatic employee compensation changes that in the end make this whole affair a big win for Trillium employees. From the company blog:
We are raising the hourly rate our retail employees are paid to between $15 and $18 an hour, based on tenure and knowledge of our craft. Those who currently work for us will move to a minimum of between $16.00 and $17.50 per hour, based on tenure. Our employees already felt well compensated under our tip-based model. By increasing their hourly wages we provide them with a more predictable paycheck. Our customers still have the option to add a tip to recognize exceptional service.
Our current professional development program is getting better as well. Our retail employees will now have the opportunity to increase their hourly rate as they complete educational programs.
We are also finalizing our plans to update all of Team Trillium’s bonus program for 2019. We are changing the annual bonus program from a purely tenure-based system to one that also has a merit-based component. This way, our entire team will still benefit from the strong performance of our business and will now also be rewarded for their individual contributions. We will continue to provide benefits to our full-time employees, including health and dental insurance, 401k with company match, annual matching for charitable donations of their choice and free beer.
From $8 to $5 to now possibly double the original hourly wage is a wild turn of events. It made us wonder how it was possible, really. We sent a few questions over to the Tetreaults and here’s how they explained the new direction for Trillium:
CBB: Could you walk us through the business reasons and thought process that informed your first salary structure and then the controversial re-structure?
Tetreaults: We opened in Fort Point with two part-time retail employees and a business based solely on selling beer to go. We knew that hospitality would distinguish Trillium for the public so we focused on creating an experience, including educating our customers about our unique beers. That service-model approach was validated when customers asked for the option to tip for exceptional service. Fast forward five years and we now have several options for customers to enjoy a beer at Trillium. “I’m hanging out, talking to my bartender, enjoying some beers, and I will tip for service,” and “I am quickly buying beer to take home” yields a different customer experience and our re-structure better reflects that.
The raises you just announced are well above the original levels. What’s the new thought process and business vision you have sketched out?
We are finally building the experience-based destinations that reflect our original intention for Trillium: places you can visit, spend time and enjoy our beers on site. We now see the difference between the transactional moment some customers have at retail and the more integrated experience you have when you engage with our bartenders and servers.
I assume getting to these pay levels was difficult when doing the math, especially from where they started. What changes organizationally did you have to do or are you planning on doing in order to make this work?
We still have plans to grow, and we believe that investing in the stability of our team is the most important thing for our future. We will phase the build-out of the farm brewery in the next few years to achieve our intended agriculture, estate beer and event programming.
What new concerns do you have or risks are there to your business now?
The risks are the same as they have been for the last couple years: increased competition in the industry leads to more choices for both the customer and the employee. Our focus has always been on producing the highest quality beers and a constant pursuit of improvement. We believe that taking care of our team helps us keep the commitment to quality and values experience.
In the wake of all this, has anything else changed in how you are running Trillium going forward?
After building the restaurant this past year, we’ve learned a lot about how we can better manage our locations and our growth for the future. We’ve been working on several operational and structural changes to introduce over the next year. We have expanded our team and continue to do so with specific roles focused on communication, team building and development and operational ownership.
We thank the Tetreaults for explaining. Cynically, we will wonder how the business would have proceeded without being called out, but businesses, like people, make mistakes, and Trillium is far from the only craft brewery with growing pains. So, credit to Trillium for this sharp course correction. Might be a good wake up call for other breweries out there to proactively review their own compensation plans to see if there is room for improvement — not to avoid the bad press, but because it’s a better way to run a business.