Former Red Lobster executives describe ‘miserable’ work environment and Thai company’s overhaul before filing for bankruptcy

Former Red Lobster executives and top executives described ‘miserable’ work environment in new report after major Thai seafood company began running the business, leading to downfall sudden change in business.

The Orlando, Fla.-based chain filed for Chapter 11 protection on May 19 after unexpectedly closing nearly 100 locations last week.

The filing comes four years after Thai Union – which owns a 49% stake in Red Lobster – became the company’s largest shareholder and became involved in day-to-day operations.

Former employees say Thai Union’s incompetence destroyed the company, according to CNN.

“It was miserable working there for the last year and a half,” Les Foreman, vice president of the West Coast division who worked at Red Lobster for 20 years and was laid off in 2022, told the network. They had no idea about running a restaurant business in the United States.”

The Thai Union has blamed its financial woes on the COVID-19 pandemic, rising interest rates and labor costs.

After Thai Union became the largest shareholder, it began appointing its own executives, forcing many longtime and respected employees to be fired or resign quickly, top executives told CNN.

The company has had five CEOs in the past five years, amid the shakeup.

When Thiraphong Chansiri, CEO of Thai Union, visited Red Lobster’s Orlando headquarters in 2022, he brought in a feng shui consultant who determined that the executive offices had “bad feng shui” and could not be used, a company executive told the media outlet.

The company’s environment became toxic during the Thai Union takeover – particularly when Australian interim CEO Paul Kenny became head of the company in 2022, according to CNN. Kenny was part of the Thai Union-led investor group that purchased the majority stake in Red Lobster.

In meetings, Kenny openly criticized and belittled employees, according to former Red Lobster executives who worked closely with him.

Kenny made the decision in May 2023 to implement the doomed $20 Unlimited Shrimp promotion as a permanent menu item “despite significant misgivings from other members of the company’s management team.” company,” the filing states.

Kenny had cut two of his longtime shrimp suppliers — Thai Union’s competitors — to buy more shrimp from Thai Union at high prices, the filing says.

Red Lobster is “investigating whether Mr. Kenny’s decision-making process circumvented the company’s normal supply chain and demand planning.”

Tibus also revealed in the filing that the company was investigating Thai Union’s role in its downfall, alleging that the Thailand-based seafood company “exercised inordinate influence over (the company’s) shrimp purchases.” »

Kenny’s leadership had a profound impact on the operations of Red Lobster locations due to a number of cost-cutting measures that affected the dining experience.

They started leaving tails on shrimp in pasta and removed sautéing stations from kitchens to reduce labor costs, an employee told CNN.

Servers began covering 10 tables instead of three, and hosts were removed during lunch hours – allegedly in the name of customer service.

There were fewer managers and cooks than ever in those days, according to Barry Fulghum, who worked his way up to operations manager after starting as a dishwasher at Red Lobster in the 1970s.

The restaurant’s overworked staff included fewer managers and cooks than ever before, said Barry Fulghum, who started as a dishwasher at Red Lobster in the 1970s and worked his way up to director of operations before retiring l ‘last year.

“There were times when one or two people were working in the kitchen,” he said. “What these cooks did on the line was incredible considering the staffing situation. »

The result: less enthusiastic customers and lower revenue.

Red Lobster has 36,000 employees and owes them $16.7 million in unpaid wages, according to the filing.

Red Lobster said its remaining restaurants will be open and operating as usual during the bankruptcy proceedings, but is considering closing additional locations.