BURGER NEWS
Austin-based P. Terry's launches employee ownership and profit sharing
Starting June 9, employees at P. Terry's Burger Stand won’t just be working the fryer. At 38 locations across Texas, 1,800 workers will have a stake in the company as it transitions to an Employee Ownership Trust (EOT).
The cooks, cashiers, and shift leads will not be direct owners of the company. Instead, an independent trust holds company shares on behalf of the employees while preserving cofounders Kathy and Patrick Terry’s original mission.
The model will be coupled with a profit-sharing program for staff with at least two years of tenure under their aprons. Immediately, P. Terry’s will distribute five percent of the operating income among its eligible workers, gradually scaling up to 20 percent.
EOTs are rare among large restaurant chains, which tend to rely on profits from private equity or franchise expansion. But since opening their first 527-square-foot Austin burger stand in 2005, the Terrys have never taken the obvious path to growth.
Inspired by Eric Schlosser’s quick-service restaurant exposé Fast Food Nation, the Terrys sought to create a better restaurant model through careful sourcing, HR programs like interest-free hardship loans, and above-market wages of at least $15 per hour for full-time crew. Its work culture has been much-cited in the industry. Staff bakers make a custom cake for every employee on their birthday.
The company has also baked a community commitment since its founding. Four times a year, all locations host a Giving Back Day, sharing 100 percent of the profits from a peak Saturday service.
"From the beginning, we believed that taking care of people and building a great business weren't competing ideas," said Kathy Terry in a release. "This transition is the most honest expression of that belief we've ever made. P. Terry's has always belonged to the people who show up every day."
