A Misconduct Scandal That Ruined a Bar: Avoiding a VPR-Style #Scandoval

Unpacking the Misconduct on Vanderpump Season 11 Episode 1 (a Retail and Hospitality Use Case)

Since 2013, the cast of Bravo TV’s hit show, Vanderpump Rules, have graced our televisions week after week, year after year. The show originally centered around the staff of Lisa Vanderpump and Ken Todd’s legendary SUR restaurant, and highlighted all kinds of misconduct from managers hitting on nearly every new woman employee, to workers threatening to “full nelson” customers, to workers screaming at co-owners to “suck a…” well if you watch the show you’ll know…

After a decade of that, though, arguably the largest scandal not just on VPR but through all of Bravo history broke news in March 2023, and was highlighted at the end of Season 10 – #Scandoval. The scandal refers to Tom Sandoval cheating on his longtime partner, Ariana Madix, with one of her best friends, Raquel Leviss, in a months-long affair. However, this affair was so nuanced like an onion, and Bravo cast members and watchers alike became enraged all over again as each layer was peeled.

It didn’t take long for Scandoval to not just impact Tom Sandoval and Raquel Leviss personally, but these two bad apples spoiled the bunch – and unfortunately that bunch was the brand new bar and restaurant co-owned by Tom Sandoval, Tom Schwartz, and other regretful investors.

Immediately following the iconic Season 10 reunion, which was filmed just 3 weeks after the scandal was uncovered by Madix, Bravo picked back up their cameras and promised that Season 11 would dive deeper into the fallout of Sandoval. At the very end of January 2024, viewers finally got to see a glimpse for themselves.

Season 11, Episode 1 didn’t disappoint.

Ten minutes into the episode, Tom Schwartz opened up about the fallout he and his business, a bar and restaurant named Schwartz and Sandy’s, has faced since the scandal rocked the Bravo universe.

In this article, we’ll walk through the business impact hospitality businesses face from misconduct, some research behind misconduct at work in the industry, and provide action items business owners can adopt to prevent this from happening to their own restaurants and hospitality organizations.

5 Business Impacts of Misconduct Scandals in Retail and Hospitality

Like many retail and hospitality businesses that suffer from misconduct scandals, Schwartz outlines five significant ways this instance of executive and employee misconduct rocked his hospitality business. We’ll start by unpacking the ruined brand and personal reputation of the restaurant and their owners.

#1. Ruined Brand and Personal Reputations

Despite Scandoval being a personal scandal, the aftermath became anything but personal – it became business. As co-owners with their literal names on the front of the building and on store merchandise, Tom Sandoval and Tom Schwartz’s bar “became the scene of the crime,” said Schwartz. It took months before Schwartz could even feel comfortable wearing his own brand merch outside without getting “booed.” He now recognizes that ‘putting your name on the front of your building, your business, “means you have to hold yourself to a higher standard.” It’s unfortunate he learned that lesson after it was too late.

#2. Poor Employee Experience and Unsafe Working Conditions

The employee impact didn’t stop at him as an owner and long-time best friend and confidant of the person who committed the scandal. It spread like a poorly-controlled kitchen fire and onto employees and workers at the restaurant and tarnished the employee experience for everyone. “We felt like zoo animals in there,” said Schwartz. He continued, “people were coming in and harassing servers.” “It was toxic,” and led to “a lot of resentment [toward the co-owner] Tom Sandoval” by him, other owners and investors, and workers.

#3. Employee Turnover En Masse

With tensions rising and the employee experience in shambles, Schwartz didn’t seem very surprised to report that “staff quit” as a direct result of the scandal. Employee turnover is very common in these toxic and unsafe working environments.

#4. Lost Customers and Revenues

In addition to workers quitting, customers also quit patroning the bar. “Reservations were down,” reported Schwartz even 3 months after news of the scandal broke. By July, the situation was so bad that news outlets like The Sun reported that Schwartz and Sandys owners were considering pushing Sandoval out – both in ownership and actually banning him from showing up at the location. It wasn’t until December 2023, nearly 11 months later, that reality TV news outlet, Reality Tea, reported what might be a glimmer of hope for the bar. When asked how the bar was doing, Schwartz said “we’re in a bit of a re-birth. I hope we are…”

#5. Personal Resentment Among Owners, Investors, and Staff

After all of that, it makes sense that even months after the news broke, relationships between the bar and restaurants’ owners, investors, and staff were still tarnished. The Sun reported that entire bar staff ‘can’t stand him’ – him being Sandoval. Even more, Sandoval’s longtime best friend, Schwartz noted on the Season 11 opener that he’s built up “a lot of resentment [toward] Tom Sandoval.” He notes, “Scandoval was a radioactive cherry on top of my s*** sundae of a year.”

Research on Misconduct in Retail and Hospitality

Each year, Fama benchmarks levels and types of misconduct by industry, and documents the results in our annual State of Misconduct at Work research report. Our 2022 research found that retail and hospitality had the second highest levels of misconduct out of 9 industries that were benchmarked.

Our 2023 research, which will be published in Q1 2024, found even worse results. Consumer Services, including retail and hospitality, actually rose to the #1 spot – topping the charts in workplace misconduct. The industry saw more than 1 in 3 candidates with misconduct flags, over 6x safe levels of misconduct and over 3x the overall average across industries. When misconduct was found, candidates had an average of 16 red flags, over 4 more flags on average than candidates with flags in other industries. This means that not only is misconduct rampant in hospitality in terms of the number of people committing misconduct, it’s also more widespread and common among people engaging in it. The most common types of misconduct in the industry are harassment, intolerance, and sexual misconduct. Watchers of the show, and employees on the show, will be anything but shocked.

Take this quiz to benchmark misconduct in your workplace against your industry.

Preventing Misconduct in Retail and Hospitality

While there are so many types of solutions businesses can use to hire great-quality people that don’t engage in misconduct, hiring in retail and hospitality is a unique challenge. These jobs are generally lower paying and working environments are typically more dangerous than most. This makes OSHA violations in the industry high as well as turnover. What’s worse, retail and hospitality workers saw a substantial increase in instances of workplace violence during COVID, and even before that, a large percentage of sexual harassment claims with the EEOC involved workers in the industries. These working conditions make it hard to recruit and retain talent, leaving recruiting on a continuous cycle.

Considering these conditions, there are 3 talent acquisition solutions that can help retail and hospitality businesses remain safe and protected from costly misconduct.

1. Background checks – These solutions aren’t new or flashy or trendy. But, they can help businesses ensure that workers are who they say they are and get a better understanding of their recorded background.
2. Reference checks – A reasonable way to find information about someone and how they show up at work is by asking those who have spent time with them. This is where reference checks come in, and automated reference checking solutions can help automate this process and make it easier on the hiring team.
3. Online screening and social media background checks – As we all live more of our lives online than ever, and the gap between what we do in real life and what we share online closes, online screening and social media background checks when done right can provide significant information about how someone acts and how they will show up at work. People share all kinds of things online – including talking about illegal activities they’ve engaged in, publishing violent manifestos, harassing others, and more.
   
   Some of the more modern and valuable online candidate screening solutions also have dedicated solutions for executives including owners and investors – like Fama’s 360 product – and others for lower-level workers like those in high volume hiring, contingent, and hourly working situations – like Fama’s Essential product.

Conclusion

While misconduct like Scandoval may be gold for reality TV, it’s anything but for the businesses that get implicated in the process. Situations like this remind us how intertwined personal scandals are with our business reputations and success. They also remind us how impactful these scandals can be – breaking news, creating poor employee experiences and toxic work environments that drive employee turnover, and make customers want to patron elsewhere.

Fortunately, there are steps businesses can take to protect themselves from misconduct-ridden executives, investors, and staff. In addition to traditional background checks and reference checks, solutions like Fama that dive into everyday behaviors are likely to provide a more holistic view of the candidate, owner, and investor.

‍Learn how Fama can help protect your business.

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About Fama

Fama makes hiring great people easy. Our modern candidate screening solutions use online signals to identify candidate fit. We highlight professional attributes like creativity, innovation, and problem solving while also surfacing costly misconduct such as violence, harassment, and fraud.

We help organizations answer the big question: how might a candidate act around coworkers or customers when they join?

Talent teams use Fama to improve candidate quality and employee retention, create safe and inclusive workplaces, and place the right leadership for their organizations. Fama is compliant with the FCRA, GDPR, and integrates into a wide range of HRIS, ATS and background screening solutions.

Founded in 2015, Fama is headquartered in Los Angeles, California. We’re backed by some of the world’s leading investors, and have raised more than $30M. Learn why over 3,600 companies trust Fama at www.fama.io.