Minimizing Labor Costs:
A Steak House operates with 2 full time employees who work 8 hours per day plus a number of part-time employees who work 2 or 3 hour shifts during peak meal times. Management wants to develop a schedule for part time employees that will minimize labor costs and still provide customer service. The steak house is open from 11:00am until 10:00pm. Part-time employees are paid $7.60/hr. The total number of employees needed for each hour is shown in the table below:
Time of Day Total Employees
11 - Noon 9
Noon - 1pm 9
1pm - 2pm 9
2pm -3pm 3
3pm - 4pm 3
4pm - 5pm 3
5pm - 6pm 6
6pm - 7pm 12
7pm - 8pm 12
8pm - 9pm 7
9pm - 10pm 7
One full time employee comes on duty at 11:00 am, works 4 hours, takes a 1 hr break and works another 4 hrs. The second full time employee comes to work at 1pm and works the same 4-1-4 pattern.
Develop a minimum cost schedule (of start-times and 2hr and 3hr shift assignments) for the part-time employees? What is the daily labor expense for part-time employees?