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Why Shake Shack is testing a 4-day workweek for its employees

Brian Sozzi
Editor-at-Large

Hat tip to you, Shake Shack (SHAK), for trying to break the mold in the restaurant game.

The better burger joint began testing a four-day workweek for its restaurant employees at several of its Las Vegas locations earlier this year. Shake Shack CEO Randy Garutti tells Yahoo Finance the test has since expanded to some of its restaurants on the West Coast.

While there is a cost component to a four-day workweek, Garutti says it’s the right thing to do for often overworked restaurant workers with families. And in this tight labor market, keeping employees healthy and happy is important to ensuring they don’t grab a gig elsewhere.

“I have been working in restaurants since I was 13, the restaurant business is super hard on families as our people work a lot of hours,” Garutti explains. “Why does it have to be that way is the question we have asked. We don’t know if it will work, it’s something we are testing at our West Coast shacks. We want to see if we can attract, retain and develop more people by changing how we think about how the restaurant business works.”

FILE - In this April 15, 2015, file photo, a man walks out of a Shake Shack in front of the New York-New York hotel and casino in Las Vegas. Shake Shack reports financial results Wednesday, Aug. 10, 2016. (AP Photo/John Locher, File)

“I have had some new moms in the company come to me and say I have one less day of childcare. I have one less commute, this is amazing,” adds Garutti.

Garutti says employees will still get 40 hours of work under the plan, but that it depends on the individual.

“The important focus is on covering the Shack in the same great way we always have, and giving that leader the third day off,” Garutti explains.

Wall Street seems to be ignoring the cost component of Shake Shack’s latest worker effort and the fact it continues to pay at the top end of the hourly wage scale in the fast-food industry. The company’s stock has skyrocketed 48% this year as Garutti has cranked up new restaurant openings globally and ventured deeper into mobile ordering.

Brian Sozzi is an editor-at-large and co-host of ‘The First Trade’ at Yahoo Finance. Follow Brian Sozzi him on Twitter @BrianSozzi

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