Finding an edge in high wages

By Steven Greenhous and Stephanie Strom / New York Times News Service

Published Jul 5, 2014 at 12:01AM

CONCORD, N.H. — Ben Nawn, a sophomore at the University of New Hampshire, says his friends who work at McDonald’s are envious of what he earns working for the Boloco burrito restaurant here.

While they make $7.25 an hour, the federal minimum wage, Nawn receives $9 an hour, which Boloco sets as the floor at its chain of 22 restaurants, most of them in New England.

“That’s pretty high,” Nawn said. “$9 is a good base, and the benefits are great.”

Nawn works at one of the handful of restaurant chains that pay well above the federal minimum wage. In-N-Out Burger, the chain based in California, pays all its employees at least $10.50 an hour, while Shake Shack, the trendy, lines-out-the-door burger emporium, has minimum pay of $9.50. Moo Cluck Moo, a fledgling company with two hamburger joints in Michigan, starts everyone at $15.

These companies’ founders were intent on paying their workers more than the going rate partly because they wanted to do the right thing, they said, and partly because they thought this would help their companies thrive long term.

“The No. 1 reason we pay our team well above the minimum wage is because we believe that if we take care of the team, they will take care of our customers,” said Randy Garutti, chief executive of Shake Shack.

The nation’s fast-food restaurants, which employ many of the country’s low-wage workers, are at the center of the debate over low pay and raising the federal minimum wage — fueled by protests demanding that fast-food chains establish a $15 wage floor.

Scott Newman, manager of the Boloco restaurant here, said its above-average pay enabled him to pick from among many talented job applicants.

Fast-food industry officials have long contended that raising the minimum wage would result in fewer jobs and higher prices.

Scott DeFife, an executive vice president at the National Restaurant Association, said it was inappropriate to compare restaurants like Boloco and Shake Shack with chains like McDonald’s and Subway.

“The price point and convenience factor are more appropriately compared to casual table restaurants that have wait staff,” DeFife said.

But prices at Boloco and In-N-Out are largely similar to those at Chipotle or McDonald’s. The prices at Shake Shack are higher, but consumers flock to it because it is known for its premium hamburgers.