Wages

Michigan – The state announced that the minimum wage will increase from $10.10/hr to $10.33/hr, effective Jan. 1. Additionally, the minimum hourly wage rate for minors ages 16 and 17 (85 percent of minimum wage) will increase to $8.78/hr. The server wage for tipped employees will increase to $3.93/hr.  The increase is set by the Improved Workforce Opportunity Wage Act of 2018, which establishes the schedules of adjustments. The law requires the minimum wage to increase every year unless the unemployment rate is higher than 8.5 percent. More details.

Oklahoma – A proposed ballot initiative was filed with the secretary of state’s office. If approved, it would raise the minimum wage to $15/hr by 2029. The language calls for incremental increases starting with $9/hr by Jan. 1, 2025 and eventually rising to $15/hr. The ballot language has to be certified before the signature gathering process can begin. More details.

Longmont, CO – The city has commissioned a study to determine the economic impacts of a potential minimum wage increase. The study will likely take six months and any formal proposal would come in June or July of next year. The city is part of a consortium of cities within Boulder County that has already untaken a similar effort but the city wants their own, independent study in addition. More details.

Carbondale, IL – In a city council hearing, One Fair Wage made a presentation lauding the benefits of tip credit elimination. Saru Jayaraman appeared before the council via online video. Additionally, both proponents and opponents were allowed to speak – including servers on both sides of the issue – and it appeared that opponents of the proposal outnumbered proponents. No votes were taken and there was no timetable given for future action, if any. Of note, Carbondale is down-state and far away from the politics of Chicago and Cook County. It could be viewed as a targeted venue for One Fair Wage to test-drive the issue in more conservative parts of the state in order to assess levels of support in the event there is an effort to pass statewide legislation in early 2024. More details.

Labor Policy

NLRB – The National Labor Relations Board (NLRB) announced it would delay implementation of its controversial joint employer rule by two months from the original Dec. 26. date to Feb. 26, 2024. The announcement was part of the agency’s response to a lawsuit filed last week in a Texas federal court by a coalition of business groups seeking to prevent the agency from implementing the rule – which would expand the types of business arrangements under which a given worker could be considered “jointly employed by two or more entities,” thus easing the path to unionization at numerous brands. It is one of two recent lawsuits brought against the forthcoming rule which was announced at the end of Oct. The other suit was initiated by the Service Employee International Union at the appellate level in D.C. More details.

Labor Activism

Minneapolis, MN – A new report issued by the Workplace Justice Lab at Rutgers University finds that employers are illegally paying less than minimum wage to an estimated 32,000 workers in the Twin Cities metropolitan area. They cite, on average, workers were shorted $2,700/hr over the past decade with violations concentrated in high-demand, service-sector jobs in places like restaurants, preschools, hair salons and entertainment venues. Researchers also found that Black and Latino, immigrants, young, female and part-time workers – who disproportionately fill those service sector jobs – face higher rates of minimum wage theft violations than white, Asian and male workers. The report is being leveraged politically to further a pending proposal to create a Labor Standards Board, somewhat similar to the structure called for in the California FAST ACT. More details.

Starbucks – Thousands of Starbucks baristas across the country went out on strike this week. Starbucks Workers United, the company’s union that represents some 9,000 employees at 360 stores, is walking out on Red Cup Day, an annual promotional event. (Customers who purchase at least one holiday beverage receive a reusable red cup.) Red Cup Day is one of the company’s biggest sales days of the year. Organizers continue to demand better wages, benefits, and the right to bargain. All merchandise is limited edition and handed out on a first-come, first-serve basis, typically causing shoppers to flock to stores. The event, the “Red Cup Rebellion,” is a continuation of the walkout union workers staged in 2022. But this year, organizers invited customers to “hold solidarity actions outside of nonunion Starbucks stores to demand Starbucks respect union rights.” More details.

Key Takeaway

• A new study by the Pew Research Center reports that most U.S. adults think that the fairest way to distribute tips in a restaurant setting is to allow each server to keep all money they receive in tips, as opposed to a tip pooling arrangement. Only 14% of the nearly 12,000 respondents said that the fairest method of tip distribution is a tip pool that includes all restaurant staff, while 13% said that a tip pool that includes only servers is fairest. The move to allow for nontraditional tip pools was solidified under the Trump administration, which issued a final rule in 2020 that granted employers the ability to do so under the FLSA provided that they do not take a tip credit. Leading industry trade associations lobbied hard for that rulemaking. The results are a boon to anti-industry advocates and will find their way into the escalating anti-tip conversation percolating in markets throughout the country.

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.