Print

Email story

Comment

Email editor

Undoing damage, one step at a time

Putting antigay and racist claims in the past, the chain looks to put its folksy face front and center.

NASHVILLE - Cracker Barrel was first accused of mistreating minorities nearly 15 years ago. Numerous lawsuits and a federal inquiry later, the stigma lingers - belying the welcoming facade created by rocking chair-filled porches at the chain's restaurants across much of America.

The company, however, has taken steps to rebuild its folksy image. It has posted placards at restaurant entrances saying all customers are welcome, sponsored minority civic groups and most recently introduced a pilot program to help its Spanish-speaking employees learn English.

"From what I've seen, these people have taken steps to proactively address problems they've had in the past," said Gerry Fernandez, president of the Multicultural Food Service and Hospitality Alliance, a group that promotes diversity in the restaurant industry. "We did have problems. That's fair game to talk about. But if you're going to talk about it, we think this is one of the things Cracker Barrel is doing that's very positive."

Cracker Barrel has joined two other restaurant chains with its testing of Sed de Saber, an interactive laptop learning program with touch-pads inspired by the children's LeapPad toy. Spanish-speaking employees take home a kit, which uses a computer, books and recording technology to teach English.

Cracker Barrel, based in the Nashville suburb of Lebanon, is distributing about 100 Sed de Saber units to be tested in restaurants in Texas, Arizona, Oklahoma, Arkansas, Tennessee and Louisiana.

The language program follows long-standing complaints of racist and antigay behavior at Cracker Barrel.

The chain, a subsidiary of CBRL Group Inc., last year agreed to pay $8.7-million to settle federal lawsuits in Georgia that accused it of discriminating against black customers.

At least 42 plaintiffs, including the National Association for the Advancement of Colored People, said black customers were subjected to racial slurs, denied service or segregated in smoking sections while Cracker Barrel management ignored or condoned such actions.

Last year, Cracker Barrel settled a Justice Department lawsuit alleging similar discrimination at its restaurants. The company agreed to a number of operational changes but did not admit wrongdoing and paid no fines or penalties.

Cracker Barrel was ordered to improve its employee training. The company has posted placards in all stores encouraging customers to contact headquarters if they believe they've been treated poorly. Cracker Barrel also had to create a department to investigate discrimination complaints and hire an outside expert and testing company to make sure it complies with the settlement.

Despite the controversy that's bruised the image of a company whose stock and trade is bringing Norman Rockwell-esqe life and down-home cooking to drab interstate exits, CBRL Group has seen its share price hover near its mid 1990s peak - $42 per share. The stock set a record of $44.60 in late March, and had bottomed out near $10 per share between 1998 and 2000 during the height of the lawsuits alleging racism.

Cracker Barrel grew from one restaurant in Lebanon in 1969 into 526 full-service "country store" restaurants and gift shops in 41 states, mostly in the Southeast, Midwest, Mid-Atlantic and Southwest. It went public in 1981.

Chris Tomasso, vice president of marketing, said Cracker Barrel is a sponsor of the 100 Black Men of America conference in New Orleans this month, among other minority-oriented groups and events. Tomasso said the sponsorships were under way before the lawsuits were settled.

"There are activities we've been doing all along that we don't normally talk about," Tomasso said. "We're not out there beating our chests and saying how great we are. We feel like our relationships are built one visit at a time, one plate at a time. We like to think our work and efforts will speak for themselves."

Before the lawsuits alleging racism, Cracker Barrel was accused in the early 1990s of dismissing some workers because they were gay. Gay rights groups complained the company had a policy of firing anyone who didn't "demonstrate normal heterosexual values."

"Cracker Barrel has come a long way, but they still have a long way to go," said Daryl Herrschaft, a deputy director with the Human Rights Campaign, a gay and lesbian advocacy group.

"We're gratified they reversed course and added sexual orientation to their hiring and nondiscrimination policy," he said. "It did take them almost 10 years to do so. I think there's a lot of gays who still cringe when they drive by that Cracker Barrel sign on the highway."

The discrimination complaints scuttled a chance for Cracker Barrel to expand to New York City. After gay and civil rights leaders spoke out, the Brooklyn borough president rescinded an invitation for Cracker Barrel to look at building restaurants there.

Indeed, overcoming such image problems can hobble a company for years, said Bruce Barry, professor of management at Vanderbilt University's Owen Graduate School of Management.

"It's a very tough thing to get rid of a stigma like that, and it doesn't help when you're slow to act and react," Barry said. "It was 11 years before they adopted a nondiscriminatory policy toward gays. And in these recent lawsuits, they admitted no wrongdoing. When you add all this up, it doesn't help."

Joseph Lowery, chairman of the Atlanta-based Coalition for the People's Agenda, an alliance of 36 civil rights groups and churches, said Cracker Barrel recently opened a location near a black community in west Atlanta.

Lowery, who's been to the new location, said the store has black management and employees and has been well-received by the community.

"I'm sure there's still negative vibrations," Lowery said. "You're not in the middle of litigation this week and everything is wine and roses the next. It takes a while for word to get around. They're making a start though."

HEADQUARTERS: Lebanon, Tenn.

LOCATIONS: Operates 519 company-owned locations in 41 states as of March 2005. The country-store themed outlets offer full breakfast, lunch and dinner menus plus a retail gift and craft store.

PARENT COMPANY: CBRL Group Inc., a holding company that also owns the Logan's Road House restaurant chain. Cracker Barrel accounted for 86.5 percent of CBRL's revenue in fiscal year 2004.

NET SALES: $2.06-billion for fiscal year 2004.

EMPLOYEES: 60,000.

CHAIRMAN and CEO: Michael Woodhouse.

PRESIDENT and COO: Cyril Taylor

[Last modified June 18, 2005, 00:45:19]