Wages

Missouri – The governor signed legislation that would repeal parts of the new minimum wage law passed by 58 percent of the voters last year, freezing it at $15/hr. Under the voter-approved ballot measure, the minimum wage rose to $13.75/hr in Jan. The minimum wage is scheduled to increase to $15/hr in 2026 with annual increases based on cost-of-living increases moving forward. The newly-signed legislation will repeal those annual adjustments after the wage hits $15/hr next year. More details.

Washington, DC – The city council will likely begin voting on the mayor’s 2026 budget proposal as early as next Monday. Included in the original proposal is language repealing Initiative 26, a ballot measure passed by the voters in 2022 that gradually eliminates the tip credit by 2027. In early June, the council voted 8-4 to “pause” the increase scheduled for July 1 that would have raised the cash wage for tipped employees from $10/hr to $12/hr. That increase is now scheduled for Oct. The budget process is being held hostage by unrelated events including the approval of a new stadium that has even pulled President Trump into the conversation. More details.

Paid Leave

Missouri – The governor signed legislation repealing the state’s voter-approved paid sick time law that went into effect May 1. Per the Nov. measure, employers with business receipts greater than $500,000 a year were required to provide at least one hour of paid leave for every 30 hours worked. Employers with fewer than 15 workers were to allow workers to earn at least 40 hours per year, with larger employers mandated to allow at least 56 hours. The new repeal law takes effect Aug. 28. Workers who don’t use any accrued leave by that time may lose it. More details.

Labor Policy

Immigration – In public remarks, President Trump indicated that the White House is working on legislation that would create a pathway for undocumented workers to stay in the country. His exact remarks at an Iowa fairground were, “We’re working on legislation right now where – farmers, look, they know better. They work with them for years. You had cases where…people have worked for a farm, on a farm for 14, 15 years and they get thrown out pretty viciously and we can’t do it. We gotta work with the farmers, and people that have hotels and leisure properties too…. Now, serious radical right people, who I also happen to like a lot, they may not be quite as happy, but they’ll understand.” Meanwhile, the Big Beautiful Bill included more than $75 billion in funding for ICE through 2029. That more than doubles ICE’s budget and provides it more funding than any other federal law enforcement agency. More details. 

U.S. Senate – The Senate Committee on Health, Education, Labor and Pensions will hear the nominations of Crystal Carey to be General Counsel of the National Labor Relations Board (NLRB) and Brittany Panuccio to be a Member of the Equal Employment Opportunity Commission (EEOC). Carey is a management-side labor and employment lawyer with Morgan-Lewis and has argued numerous cases before the NLRB. Panuccio is an attorney in the Department of Justice in Florida and if confirmed, the EEOC would regain a quorum with a 2-1 Republican majority and enable the agency to fully embark on its agenda, including the Trump administration’s anti-DEI efforts. More details.

U.S. Senate – The Senate Committee on Health, Education, Labor and Pensions will discuss legislation next week aimed at extending portable benefits to independent contractors. The Unlocking Benefits for Independent Workers Act would allow independent contractors to receive access to workplace benefits such as retirement plans and health insurance access. The Modern Worker Empowerment Act proposes a standard federal employment test to determine whether an individual is an employee or independent contractor. And lastly, the Independent Retirement Fairness Act, would empower independent workers to participate in retirement benefits plans like single pension IRA plans and pooled employer plans. Labor groups are generally opposed to portable benefits plans, which they say are inferior to traditional employer-provided plans, even as Democratic-led states advance legislation aimed at shoring up benefits for gig workers. More details.

Connecticut – The governor vetoed legislation that would have made employees who had been on strike for two weeks eligible to collect unemployment benefits beginning Dec. 14, 2026. Under current state law, striking employees do not qualify for unemployment benefits, regardless of how long they remain on strike. The governor, a reliable ally of the labor community, said, “I don’t do a lot of vetoes…but I think paying striking workers is a bridge too far and it doesn’t help our cause.” Proponents have vowed to renew their effort next year. More details.

Florida – Effective July 1, the state now has the most employer-friendly noncompete law in the country. The new law, which became effective without the governor’s signature, permits employers to use non-compete restrictions up to 4 years in length with qualifying “covered employees,” along with other significant changes. Florida’s existing law was generally favorable to employers seeking to enforce non-compete restrictions. The new law goes even further, making Florida home to the most restrictive non-compete agreements in the employment context. Of most importance are two provisions: first that employers can petition for and receive immediate injunctive relief to stop the breach of a covered agreement and; secondly, that the burden of proof now shifts to the affected employee. An employee must now establish a heightened “clear and convincing” standard, without using any confidential information, to prove that side of the agreement has been honored. More details.

Maryland – DoorDash launched the expansion of its Portable Benefits Savings Pilot Program in Maryland. This means Dashers who completed at least 100 deliveries and earned at least $1,000 from April through June of this year, before tips, can open a Stride Save account and put up to four percent of their earnings towards things like health care, retirement, vision insurance, and more. Similar pilot programs have been established in Pennsylvania and Georgia. More details.

Labor Activism

Tyson – The company reached a contract agreement with 3,000 striking workers represented by the Teamsters. Two weeks ago, 98 percent of the union members voted to authorize a strike at an Amarillo, Texas facility in a push for more pay and to force the company to address allegations of unfair labor practices. The Local 577 President had previously said the strike was in part against the pay disparity between workers and the Tyson CEO.  The new contract includes a 32 percent wage increase, more paid time off, and better retirement benefits. More details.

Taxes

Trump Administration – The president signed into law his sweeping tax cut and spending package, the Big Beautiful Bill. The final bill includes many priorities of the restaurant industry including full expensing for capital equipment, deductibility of free or discounted meals, and business interest deduction clarification. Additionally, eliminating income tax on tips was capped at $25,000/yr and eliminating taxes on overtime was capped at $12,500/yr, effective tax years 2025-2028. More details.

Food Policy

American Beverage Association – The American Beverage Association (ABA) has launched a proactive campaign to educate the public and policy makers on common ingredients found in beverages. The online database, Good to Know, is described as “your go-to source for clear, science-backed information” and “what food safety agencies around the world say about them.” The campaign is clearly designed to get ahead of misinformation spreading about particular ingredients rather than the association having to constantly knock down false information after it gains traction. 

World Health Organization – The World Health Organization (WHO) is pushing countries to raise the prices of sugary drinks, alcohol, and tobacco by 50 percent over the next 10 years through taxation. This is the WHO’s strongest positioning to date, calling for taxes to help tackle chronic public health problems. The United Nations health agency said the move would help cut consumption of the products, which contribute to diseases like diabetes and some cancers, as well as raising money at a time when development aid is shrinking and public debt rising. The pillars of the “3 by 35” Initiative are cutting harmful consumption, raising revenue, and building broad political support for this campaign. The organization aims to raise $1 trillion by 2035 through health taxes but industry groups criticized WHO’s tax proposal, citing lack of evidence on health outcomes. More details.

Louisiana – The governor signed legislation that would require products containing artificial dyes, chemical additives, and other ingredients to include a warning label on the product where the substances are banned or not authorized in other countries. Some non-controversial technical changes will force the bill back over to the senate for a pro forma re-vote. The bill lists 51 different ingredients that would require the warning, including several synthetic dyes, synthetic or artificial vanillin, propylparaben, potassium bromate, melatonin, bleached flour, and others. Additionally, the legislation would prohibit public schools and non-public schools receiving state funds from serving ultra-processed foods. The bill defines ultra-processed food as any food or beverage that contains the following: Blue dye 1, Blue dye 2, Green dye 3, Red dye 3, Red dye 40, Yellow dye 5, Yellow dye 6, azodicarbonamide, Butylated hydroxyanisole (BHA), Butylated hydroxytoluene (BHT), Potassium bromate, propylparaben, and titanium dioxide. The industry successfully fought for an amendment clarifying the disclosure language regarding seed oils. More details.

Sustainability

Rhode Island – The governor signed heavily-amended legislation calling for a statewide recycling needs assessment and the creation of a recycling advisory council. The original bill, introduced in April, had called for establishing a 10-cent deposit on certain beverage containers, setting up details of a packaging Extended Producer Responsibility (EPR) system, setting certain recycling and return targets, and other features. State legislators instead voted in June to delete these provisions and replace them with a study bill. More details.

Key Takeaways

• The restaurant and retail industry would be wise to borrow from the beverage industry’s Good to Know campaign. As food ingredients face scrutiny (seed oils for instance) a forward-facing education effort is necessary to proactively dispel misinformation. 

• Expect ICE raids and enforcement actions to steeply increase. The Big Beautiful Bill included $75 billion in funding for ICE through 2029, making it the most heavily-funded federal law enforcement agency (FBI, etc.). At the same time, President Trump has indicated a willingness to work with the employer community to create legal pathways for workers. Brands must prioritize engagement on this issue ahead of the midterm elections.

• A new research paper from the University of Pennsylvania’s Wharton School of Business suggests that the best way to reduce income inequality is to use both minimum wages and income taxes in a complimentary way instead of using one in lieu of the other. For many years, economists across the ideological spectrum have argued that the tax code was the best way to address income inequality and increase buying power for low wage workers because mandating minimum wage increases is inherently inflationary, which quickly wipes out any short-term gains. This paper suggests that while leveraging the tax code is still critically important, minimum wage increases are also necessary because of the ability of large employers to avoid full taxation. In fact, they state that the minimum wage serves as an indirect mechanism for extracting firm profits and redistributing them to low-skilled workers, assuming that firm profits are not directly taxed. The study can be read here.

• Recently, the Chicago Tribune printed an editorial discussing the “restaurant crisis” in the city, particularly for independents, and laid the blame squarely on the mayor and his allies on the city council for their efforts to eliminate the tip credit. The piece cited not only data from Chicago but highlighted ongoing efforts in Washington, D.C. to repeal their voter-approved law and the voter rejection of a similar proposal in Massachusetts last Nov. For context, as of July 1, the minimum wage in the city rose to $16.60/hr and the server wage to $12.62/hr. While Chicago Mayor Brandon Johnson seems entrenched in his positioning, the general tide on the issue has swung considerably in the last year or two and the industry should continue to hammer away on the failed rhetoric of One Fair Wage.

Podcast

Check out our Working Lunch podcast each week that includes further analysis into these legislative issues, policy, politics and much more. You can find Working Lunch on the Restaurant Business online website, SoundCloud, iTunes and Spotify.