Red Lobster decided the most festive way to celebrate the holidays was to lay off a few hundred employees. The casual dining seafood chain confirmed to Restaurant Business that around 200 restaurant-level employees—most of them salaried managers — have been laid off.
The company says the cuts represent “less than 1%” of its workforce and are part of a “targeted” restructuring plan to “minimize disruption and reflect our focus on building a stronger, more agile business.”
The layoffs come as the largest seafood chain in America tries to claw its way out of financial turmoil. Red Lobster filed for Chapter 11 bankruptcy in May 2024 and closed more than 100 locations. The chain was taken over by Fortress Investment Group and has been trying to recover by cutting costs and scaling back operations.
While the company actively poured money into tech upgrades — such as an AI voice system and new online ordering software — and rebranded shrimp deals, internal staffing was quietly thinned out.
A Red Lobster manager in Iowa shared their experience with the layoffs just a month before the company acknowledged them publicly.
“I’ve been a salaried manager for several years and stuck through the bankruptcy earlier this year,” they wrote. “Once the company got bought out and Damola became CEO, things started changing fast.”
The Reddit user said Red Lobster employees were given a glimmer of hope when new CEO, Damola Adamolekun, took over in August 2024 — but that hope didn’t last long.
“The new CEO came and made us the promise that was it and we had been doing so well til last month.” they wrote. “ It was a hard month for everyone, but instead of the usual ‘we will turn this back around,’ we all got fired, once again.”
The laid off manager said performance bonuses were delayed multiple times, including a Q3 bonus that was pushed from October to December.
“And today… they laid off what looks like between 250 and 500 salaried managers across the company,” they wrote. “I’ve gotten zero written notice, no severance, and no bonus payment.”
The same manager said severance paperwork included preset termination reasons like “misconduct” or “voluntary dismissal” — designations that could block unemployment eligibility.
“This keeps getting sketchier by the day,” they wrote.
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