State of the Union
Presidential Address – President Biden’s first official State of the Union (SOTU) address which was originally intended to focus largely on domestic priorities was recast as a result of Russia’s invasion of Ukraine. Despite the international focus, a number of domestic priorities were mentioned in the speech, many particularly important to the restaurant industry including paid leave, a $15/hr minimum wage, the elimination of the tipped wage, the PRO Act, corporate taxes, childcare, and immigration. For issues like the tipped wage to share space in the SOTU address along with the situation in Ukraine demonstrates the perceived political importance of the issue within the administration.
Wages
Target – The company will raise its minimum wage as high as $24/hr this year depending on the local market. Target currently pays a $15/hr starting wage but said this week that it would begin paying starting wages ranging from $15/hr to $24/hr. The starting rate will depend on the job, the market, and local wage data, among other factors. The wage increase is a part of a $300 million investment in pay and benefits. The company also said it would expand employee access to health care and hourly employees who work an average of at least 25 hours a week will become eligible for the company’s medical plan. More details.
Paid Leave
Federal – The White House released its National COVID-19 Preparedness Plan which includes, among other things, emergency paid family and medical leave. The provisions are essentially the resurrection of an expired program that the U.S. Congress passed with bipartisan support in an earlier round of pandemic relief. That program required employers to give workers paid family and medical leave for COVID-related reasons and provided the businesses with tax credits for doing so. A portion of the program was extended once (only the tax credits, not the mandate). It’s not clear yet whether the White House is floating the tax credits as an option for employers or as a requirement. More details.
Labor Policy
Labor Department – The agency announced its intention to hire 100 new investigators in its Wage and Hour Division. Currently at its lowest staffing levels in over a decade, the division oversees the enforcement of many important federal employment laws, including the FLSA (Fair Labor Standards Act) and FMLA (Family and Medical Leave Act). The large push to hire a significant number of investigators in the division signals an increased focus and prioritization of enforcement for targeted industries. As a result, employers should review key areas of their workforce and Human Resources practices in order to confirm compliance with the laws that will be a subject of the DOL’s heightened focus on wage-related issues. More details.
Labor Activism
REI – Workers at an REI store in New York City voted to unionize this week, creating the only union at the outdoor equipment and apparel retailer. The vote, which took place at the store, was 88 to 14. Workers at the store began to organize in the fall of 2020, partly because many felt that employees who had been outspoken in raising Covid-related safety concerns were not allowed to return after REI temporarily closed its stores that year. An election petition was filed five weeks ago. More details.
Starbucks – The SEIU-affiliated Workers United campaign against the company continues to escalate. A Mesa, Arizona store voted overwhelmingly to unionize this week, and workers at additional stores announced their intent to begin organizing campaigns. Workers United also ramped up legal efforts this week, filing a number of unfair labor practice complaints.
Independent Coffee Chains – The national Starbucks organizing effort, which emanated from successful campaigns at independent coffee chains, is now spurring a new wave of organizing efforts at local independent chains. This week workers at two chains, Storyville Coffee in Seattle and Good Karma Cafe in Philadelphia, filed election petitions with the NLRB. Storyville workers are organizing under the UFCW banner and Good Karma workers are affiliated with Workers United. A third group of workers at independent coffee chain Great Lakes Coffee Roasting Co. just won their union election and have affiliated with UNITE HERE. While all workers cite the Starbucks campaign as their inspiration, the different union affiliations are one indication of the organic and viral spread of unionization efforts. More details.
Alcohol
Maine – Legislation extending cocktails to-go through March 30, 2025 has passed both chambers. There are slight differences in the bills which need to be worked out but final passage and the governor’s signature are expected soon. More details.
New York – The governor announced that she has “set in motion” the regulatory process that would permanently allow cocktails to-go and alcohol delivery, repealing the current emergency law that needs to be renewed every 30 days. The proposal is embedded in the governor’s budget which will be approved by the legislature in the next few months. More details.
Washington, DC – The city council unanimously passed on first reading legislation to extend current outdoor dining and alcohol ordinances until the end of 2023. The legislation, sponsored by the mayor, would also make it easier for restaurants to expand outdoor seating. The bill needs to be approved by the council an additional time before going to the mayor’s desk for her signature. More details.
Delivery
Oklahoma – A house committee advanced legislation prohibiting third-party platforms from picking up and delivering food without a contract with the restaurant. In addition to significant fines for a violation, the legislation also creates a private right of action for the restaurant owner. More details.
Scheduling
Maryland – Onerous legislation to mandate scheduling provisions including restrictions around on-call programs, notice of scheduling, and extensive paperwork requirements was reported “unfavorably” by a house committee and is likely dead for the year. More details.
Sustainability
Hawaii – An additional house committee advanced legislation that would establish an extended producer responsibility program in the state. The bill would require certain producers of consumer goods to register with the state health department and pay an annual fee based on the amount of packaging volume the covered producer places on the market each calendar year. Additionally, the bill provides for the deposit of fees into a special extended producer responsibility fund and some of those monies be allocated toward the creation of a report that assesses the resources needed to reduce the volume of packaging waste sent to landfills. If passed out of the house, the bill faces an uncertain future in the senate. More details.
Kansas – A hearing is scheduled in a house committee next week to consider senate-passed preemption legislation that would prohibit localities from regulating food packaging and utensils. More details.
Los Angeles, CA – The city council has begun the process of implementing recommendations from the Nov. 2021 report by the city’s sanitation department outlining policy initiatives the city should pursue to reduce waste. Last Nov., the city began implementing an on-request ordinance for food-ware for restaurants and businesses with 26 employees or more, which will expand to all city businesses come April 22. The recommendations include a citywide ban on expanded polystyrene (EPS) foam food-ware and pushing city facilities and events toward zero waste by phasing out purchase and use of single-use plastics. The county is also seeking to require that single-use food-ware be either recyclable or compostable. More details.
Misc.
Florida – The house passed legislation targeting “woke ” corporate training and critical race theory in Florida schools. The bill has advanced out of an initial committee in the senate with additional committee stops to come. Opponents of the bill, which is a priority of the governor, say the bill’s true goal is to stifle potentially difficult classroom and workspace conversation of race, gender identity, and privilege. The legislation is highly likely to become law. More details.
Key Takeaways
- Brands need to reprioritize labor relations efforts to markets where the Starbucks organizing efforts are spilling over to other brands. The top three markets to watch right now are Seattle, Philadelphia, and Detroit. Much of the organizing efforts are still contained to the high-end coffee segment but it will not remain that way for long. It’s only a matter of time before other national brands are pulled in.
- Interest groups compete fiercely for a mention of their issue(s) in the president’s annual SOTU address. Given the compressed time in the speech for domestic priorities, an impressive (and troubling) amount of time was given to issues impacting the industry. The address signals not only to Congress but also federal agencies and interest groups, the president’s top priorities and clearly a number of our issues will continue to be front-and-center.
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.