Case study /Red Lobster
Christopher H. Lovelock
A peer review panel of managers and service workers from
a restaurant chain must decide whether or not a waitress has
been unfairly fired from her job.
“It felt like a knife going through me!” declared Mary Campbell, 53, after she was fired from her waitressing job at a restaurant in the Red Lobster chain. Instead of suing for what she considered unfair dismissal after 19 years of service, Campbell called for a peer review, seeking to recover her job and three weeks of lost wages.
Three weeks after the firing, a panel of employees from different Red Lobster
restaurants was reviewing the evidence and tried to determine whether the server had, in fact, been unjustly fired for allegedly stealing a guest comment card completed by a couple of customers whom she had served.
PEER REVIEW AT DARDEN INDUSTRIES
Red Lobster was owned by Darden Industries, which also owned other restaurant chains like Olive Garden, Longhorn Steakhouse, The Capital Grill, Bahama Breeze, and Seasons 52. The company has about 1,900 restaurants serving 400 million meals a year. Red Lobster, which has more than 180,000 employees, had adopted a policy of encouraging peer review of disputed employee firings and disciplinary actions several years earlier. The company’s key objectives were to limit worker lawsuits and ease workplace tensions.
Advocates of the peer review approach, which had been adopted at several other companies, believed it was a very effective way of constructively channeling the pain and anger employees felt after being fired or disciplined by their managers. By reducing the incidence of lawsuits, a company could also save on legal expenses.
A Darden spokesperson stated that the peer review program had been “tremendously successful” in keeping valuable employees from unfair dismissal. Each year, about 100 disputes ended up in peer review, with only 10 subsequently resulting in lawsuits. Red Lobster managers and many employees also credited peer review with reducing racial tensions. Ms. Campbell, who said she had received dozens of calls of support, chose peer review over a lawsuit not only because it was much cheaper, but “I also liked the idea of being judged by people who know how things work in a little restaurant”.
The review panel included a general manager, an assistant manager, a server, a hostess, and a bartender, who had all volunteered to review the circumstances of Mary Campbell’s firing. Each panelist had received peer review training and was receiving regular wages plus travel expenses. The instructions to the panelists were simply to do what they felt was fair.
Campbell had been fired by Jean Larimer, the general manager of the Red Lobster in Marston, where Campbell worked as a restaurant server. The reason given for the firing was that Campbell had asked the restaurant’s hostess, Eve Taunton, for the key to the guest comment box and stole a card from it. The card had been completed by a couple of guests whom Campbell had served and seemed dissatisfied with their experience at the restaurant. Subsequently, the guests learned that their comment card, which complained that their prime rib of beef was too rare and their waitress was “uncooperative”, had been removed from the box.
Jean Larimer’s Testimony
Larimer, who supervised 100 full- and part-time employees, testified that she had dismissed Campbell after one of the two customers complained angrily to her and her supervisor. “She [the guest] felt violated,” declared the manager, “because her card was taken from the box and her complaint about the food was ignored.” Larimer drew the panel’s attention to the company rule book, pointing out that Campbell had violated the policy that forbade removal of company property.
Mary Campbell’s Testimony.
Campbell testified that the female customer had requested that her prime rib be cooked “well done” and then subsequently complained that it was fatty and undercooked. The
waitress told the panel that she had politely suggested that “prime rib always has fat on it”, but arranged to have the meat cooked some more. However, the woman still seemed unhappy. She poured some steak sauce over the meat, but then pushed away her plate without eating all the food. When the customer remained displeased, Campbell offered her a free dessert. But the guests decided to leave, paid the bill, filled out the guest comment card, and dropped it in the guest comment box.
Admitting she was consumed by curiosity, Campbell asked Eve Taunton, the restaurant’s hostess, for the key to the box. After removing and reading the card, she pocketed it. Her intent, she declared, was to show the card to Ms. Larimer, who had earlier been concerned that the prime rib served at the restaurant was overcooked, not undercooked. However, she forgot about the card and later, accidentally threw it out.
Eve Taunton’s Testimony
At the time of the firing, Taunton, a 17-year-old student, was working at Red Lobster for the summer. “I didn’t think it was a big deal to give her [Campbell] the key,” she said. “A lot of people would come up to me to get it.”
THE PANEL DELIBERATES
Having heard the testimony, the members of the review panel had to decide whether Ms. Larimer had been justified in firing Ms. Campbell. The panelists’ initial reactions to the situation were split by rank, with the hourly workers supporting Campbell and the managers supporting Larimer. But then the debate began in earnest in an effort to reach consensus.
Exhibit 1 The restaurant scene becomes the testing ground for the validity of peer review
1. What are the marketing implications of this situation?
2. Evaluate the concept of peer review. What are its strengths and weaknesses?
What type of environment is required to make it work well?
3. Review the evidence. Do you believe the testimony presented?
4. What decision would you make and why?
By Week 6, you have to submit a written report of the case under Assignments. Your report is not to exceed 5 pages including a separate title and reference page and include at least two references in addition to the textbook. It must be typewritten using Times New Roman 12pt. font, 1-inch margins according to APA Style Guide, 6th ed.
You have a case to analyze independently and you you have already turned in the written report. You are being asked to present to the class for 7-8 minutes which will allow for 2 minutes of questions and answers. Each case will have several key issues faced by a firm or a manager that are relevant to the nature of the business. You will need to give us a synopsis of the case and the challenges it presents. You can then discuss what they did right or wrong and or how you would proceed to solve the issues. Please use some of the topics we have discussed in this class and others you have taken to explain and support the case. You will turn in your power point or whatever your media is for your presentation into this drop box. Please be ready to use a flash drive or google docs or however it is best for you to access your information within the class. You will be accessed on the following.
Timing not under 7 minutes and not over 8:) so practice.
Ability to paint the picture of the case. Analysis of the case and what the did good or bad?
What do you suggest they do moving forward? Or what they should have done if you could turn back time.
I hope this helps clarify things. Let me know if you have any questions.
I also put my class lecture on attaches
Please use some information from it