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Applebee's Franchise Executive Said High Gas Prices Will 'Force People Back Into The Work Force'

The restaurant brand's chief operations officer said the executive is no longer part of the franchise

Applebee’s is facing backlash after emails from one of its executives celebrating high gas prices as a benefit to the company were released online over the weekend.

The executive was identified as Wayne Pankratz of American Franchise Capital.

In the emails, Pankratz wrote that the increased cost of fuel would have a positive impact on hiring because employees in need of extra income will be willing to accept lower wages. 

“Most of our employee base and potential employee base live paycheck to paycheck,” Pankratz wrote in the emails, which were initially posted to Reddit.“Any increase in gas prices cuts into their disposable income. As inflation continues to climb and gas prices continue to go up, that means more hours employees will need to work to maintain their current level of living.”

Pankratz said the chain will no longer be “competing with the government when it comes to hiring” as pandemic era stimulus money was no longer being distributed.

“Furthermore, other competitors, (especially mom and pop companies or smaller businesses) will have to either raise prices, cut employee hours, or pay employees less hourly to hit their profit margins,” Pankratz wrote. “Some businesses will not be able to hold on. This is going to drive more potential employees into the hiring pool.”

The executive advised companies to hire new employees at lower wages, decrease labor when possible, and keep “a pulse on the morale of your employees.” He noted that many employees may need to get a second job or take on additional hours due to the rising cost of living.

“Do things to make sure you are the employer of choice. Get schedules completed early so they can plan their other jobs around yours,” Pankratz added.

At least three managers at an Applebee’s location in Lawrence, Kansas, quit over the emails.

“I was just stunned and disgusted,” Jake Holcomb, one of the managers, told the Lawrence World Journal. Holcomb has worked at several of the company’s locations since 2020. He printed copies of Pankratz’s messages and gave them out to other employees.

“It is embarrassing. It really is,” said Scott Fischer, the director of communications of Apple Central, told the paper. Apple Central operates 47 Applebee’s locations in the midwest.

A representative for Applebee’s told CBS News that Pankratz was no longer employed by the company. 

“The individual has been terminated by the franchisee who owns and operates the restaurants in this market,” chief operations officer Kevin Carroll said in an emailed statement.

Carroll said the message was “the opinion of an individual, not Applebee’s” and that its employees were the “lifeblood of our restaurants.”

“Our franchisees are always looking to reward and incentivize team members, new and current, to remain within the Applebee’s family,” Carroll wrote. 

There are more than 1,700 Applebee’s franchise locations across the United States. In 2021 the brand reported over $4 billion in sales.

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