A Report Comparing Employee Salaries at Mama Mia and Pasta Roma Restaurants - Essay Example

?A Report Comparing Employee Salaries at Mama Mia and Pasta Roma Restaurants Mr. Corleone Background Information Mama Mia’s and Pasta Roma restaurants are part of the Da Vinci Themed group of restaurants. Both restaurants employ the staff on full-time, part-time and seasonal basis. At present, Mama Mia’s employs 248 employees while Pasta Roma employs 196 employees. While the two restaurants are largely similar in terms of products and services offered and thus requires similar efforts from their employees, observations seems to indicate that employees in the two restaurants do not enjoy comparable salaries. This report aims to investigate this issue and provide statistical evidence that would prove or disprove the comparability of salary packages awarded to the employees of the two restaurants. Procedure Information was gathered on the salaries that employees from the two restaurants receive. Upon collecting these data, they were subjected to statistical analysis using the appropriate computer software. Pertinent statistical data of interest regarding employee salaries were: Shape of the distribution, Mean, Median, Minimum value, Maximum value, Range, Lower quartile value (Q1), Upper quartile value (Q3), Semi-interquartile range (SIR), Standard deviation, and Total Salaries. In addition, the number of employees were also noted. The results are presented in Table 1 below. Findings Table 1. Summary of Descriptive Statistics on the Salaries of Mama Mia and Pasta Roma Employees.   MAMA MIA ROMA PASTA Shape of distribution Positively skewed Negatively skewed Mean salary PW ?550 ?553 Median salary PW ?470 ?540 Min ?199 ?450 Max ?901 ?800 Range ?702 ?350 Q1( lower quartile) ?300 ?510 Q3(upper quartile) ?670 ?590 SIR ?185 ?40 Standard deviation ?117 ?66 Number of employees 248 196 Total Salaries ?116560 ?105840 Discussion and Analysis of Results The mean salary of employees from Mama Mia was ? 550 per week while Roma Pasta employees earn an average of ?553 per week. However, since the distributions are skewed, the median is the best measure to use in describing the average salaries of the employees. Looking at the data, we see that fifty percent of Mama Mia employees earned less than ?470 per week while 50% of Roma Pasta employees earned less than ?540 per week. These values indicate that more Roma Pasta employees are getting higher salaries than Mama Mia employees. In addition, the salary range of Mama Mia employee salaries is ?702 with a minimum salary of ?199 and ?901 while the salary range of Pasta Roma employee salaries is ?350 with a minimum salary of ?450 and a maximum salary of ?800. A further look into the results indicate that Q1 or the lower quartile employees for Mama Mia’s earn ?300 while lower quartile employees for Pasta Roma earn ?510. This means that 25% of Mama Mia’s employees have salaries of less than ?300 while 25% of Pasta Roma employees have salaries of less than ?510. Considering that the minimum salary received by Pasta Roma employees is ?450, this result suggests that even low-level Pasta Roma employees are being paid better than the low-level Mama Mia’s employees. Furthermore, Q3 or employees belonging to the upper quartile for Mama Mia’s earn ?670 while employees belonging to the upper quartile for Pasta Roma earn ?590. This time, we notice that the upper level employees of Mama Mia’s are actually paid better than the upper level employees of Pasta Roma. Thus, the middle 50% of Mama Mia’s employees earn ? 300 - ? 670 while the middle 50% of Pasta Roma employees earn ?510 - ?590. Factoring in the semi-interquartile range (SIR) of both groups, we see that Mama Mia’s has a high dispersion of the middle 50% of salaries about the median, given at ?185, while Pasta Roma has a low dispersion of the middle 50% of salaries about the median, given at ?40. In addition, the standard deviation of ?117 indicates a large amount of dispersion about the mean for Mama Mia’s while the standard deviation of ?66 indicates a relatively smaller amount of dispersion about the mean for Pasta Roma. Conclusion  Due to the skewed nature of the distribution of employee salaries, the means will tend to overstate the average in a positively skewed distribution and understate it in a negatively skewed distribution. Thus, it would be best to use the median salaries in providing a better description of the data. It is for these same reasons that semi-interquartile ranges will provide a better description of the dispersion of the data compared to standard deviation. Hence, it can be concluded that there is indeed a discrepancy in the comparability of the salaries given to the employees of the two restaurants. More specifically, low-level employees from Mama Mia’s are receiving much lower compensation when compared to their counterparts at Pasta Roma. However, it can be quite advantageous for high level employees working at Mama Mia’s because they generally receive much higher compensation than their counterparts at Pasta Roma. Furthermore, measures of dispersion indicate that employees at Pasta Roma have less variable salaries. This means that salaries of higher level employees are not extremely greater than salaries of lower level employees, not unlike the stark difference in the nature of salaries of Mama Mia’s employees. A review of the salary package being offered to Mama Mia’s and Pasta Roma’s employees is in order so that employees would not be too demoralized when they realize that their counterparts in the other store are relatively receiving better compensation than they are. Recommendations for further investigation It would be prudent for management to look into the general nature of the employment status of staff members working at the two restaurants. It would also be wise to look into the actual qualifications of their employees because this might also be playing a part in the compensation being offered, that is, Mama Mia’s low level employees might possess skills that are too mediocre while Pasta Roma might be overcompensating their low-level employees and undercompensating their high level employees. A closer look at these data may provide a clearer explanation as to the differences in the comparability of the salary packages of the two restaurants. Read More