Wages
Ohio – The state ballot board approved language for the 2024 ballot that would incrementally raise the minimum wage to $15/hr by 2026 and eliminate the tip credit by 2029. The petitioners, Raise the Wage Ohio, will need to collect signatures from voters equal to 10 percent of the vote cast in the most recent gubernatorial election, approximately 413,000. If the signatures are verified by the Ohio Secretary of State at least 65 days prior to the election, the measure will be placed on the 2024 general election ballot. More details.
New York – The deadline to approve the state budget, initially Apr. 1, was extended a third time to Apr. 20 and that was missed as well. It is unclear when a resolution will be found. Of major importance to the industry is language included that calls for a minimum wage increase to $21.25/hr by 2027.
Virginia – The governor signed legislation requiring all employers to pay employees with disabilities at least minimum wage starting in 2030. Employers with current certificates allowing sub-minimum wages to this class of worker will be grandfathered in until 2030 but no new certificates will be issued as of July 1, 2023. More details.
Labor Policy
U.S. Senate – The Senate HELP committee held a contentious confirmation hearing regarding the nomination of Julie Su as the next Labor Secretary. While the labor community strongly supports her nomination, business groups, including the National Restaurant Association and the International Franchise Association, have cited her record as California labor secretary and her support for the state’s labor regulations to suggest that she is a threat to their business models. A formal committee vote on her nomination is expected next week. More details.
Oklahoma – The house advanced senate-passed legislation to lower the allowable age for employees to serve cocktails. The current age for servers to handle mixed drinks is 21 but the legislation calls for lowering that to 18. The bill was amended in the house and heads back to the senate for concurrence. More details.
Portillo’s – The company has formally asked the National Labor Relations Board to set aside a union election at a food production facility in Addison, Ill. Last week, employees at the plant voted 28-20 for union representation but the company is claiming illegal tactics by the union and that the result should be voided. The bargaining unit only applies to the processing facility and not to employees of the 70 restaurants in 10 states. More details.
Labor Activism
Starbucks – The company crossed a significant threshold this week with the 300th store voting to unionize. Seventy-three stores have rejected a union and an additional 25 or so are still in the process. More details.
Sustainability
California – An additional senate committee advanced legislation that would require all companies earning at least $1 billion in annual revenue and doing business in the state to provide information on their global carbon footprints starting in 2026, including emissions from direct operations, energy use, and supply chains. The bill would be more stringent than the SEC’s proposed climate disclosure rule, which would only apply to publicly traded companies and wouldn’t require all of them to disclose supply-chain emissions, also known as Scope 3. The disclosures would require third-party verification and would be handled by the California Air Resources Board, which would contract with a nonprofit organization to create a public database. The bill would allow the attorney general to bring civil action against non-compliant companies, a scaling back of the previous version’s proposed authority to levy fines for violations. More details.
Oregon – A house committee heard senate-passed legislation banning Styrofoam containers used for the purchase of prepared foods. The legislation prohibits a food vendor from using polystyrene foam containers in selling, offering for sale, serving, or dispensing prepared food to consumers. It also prohibits anyone from selling, offering for sale, or distributing polystyrene foam containers, polystyrene foam packaging peanuts, or foodware containers containing intentionally added perfluoroalkyl or polyfluoroalkyl substances in or into this state. It further establishes a civil penalty not to exceed $100 per day for food vendors that violate prohibition of providing prohibited containers and $500 per day for persons selling, offering, or distributing. More details.
Berkeley, CA – A federal appeals panel overruled the city’s ban on natural gas hookups passed in 2019 making Berkeley the first city to prohibit natural gas connections in new buildings. The California Restaurant Association challenged Berkeley’s ban in federal court, arguing that the federal Energy Policy and Conservation Act (EPCA) preempts local regulation of gas appliances. A lower-court judge disagreed but was overruled this week by a three-judge Ninth Circuit panel. It is unclear if proponents will appeal to the U.S. Supreme Court. Since the initial ban in Berkeley, San Jose, New York City, San Francisco, Seattle and others have followed. New York Gov. Hochul proposed a statewide ban on gas hookups in new small buildings in 2025 and larger ones in 2028. More details.
Alcohol
Washington – Legislation is on its way to the governor allowing most on-premise, liquor-license holders to sell pre-mixed drinks in sealable containers with takeout orders. A temporary version of similar rules was set to expire at the end of June and the new law takes effect July 1. License holders who will be able to offer to-go cocktails, glasses of wine and beer (in factory-sealed or tamper-evident packaging) include full-service restaurants, taverns and snack bars; domestic wineries, breweries, microbreweries and distilleries; nonprofit arts institutions and catering companies. Though available at no additional cost, these businesses would have to receive formal approval from the Liquor and Cannabis Board, adhering to the agency’s rules. More details.
Key Takeaways
- The ruling regarding Berkeley’s effort at enacting a local natural gas ban is significant. Not only is it an immediate setback for environmentalists but it also reaffirmed federal preemption in this space which potentially places all existing similar statues in peril. Perhaps most importantly, it will have a chilling effect on the pursuit of similar ordinances in the future. It is a huge win for the industry both in the immediate and long term.
- This week, the Government Accountability Office released a report requested by the Ranking Member of a House Energy & Commerce subcommittee, Rep. Jan Schakowsky (D-IL), entitled, Actions Needed to Improve Education Efforts and Awareness of Complaint Process for Franchise Owners. The basic theme of the report is that, according to the New York Times, “franchisees do not enjoy the full benefit of the risks they bear.” The report is packaged as a resource to better help franchisees understand the law and provide information on how to pursue legitimate complaints with their franchisor partners. In reality, however, it will be leveraged as the analytical “data” to validate franchise legislation at the federal and state level. Of primary importance is the entrance of an arm of the federal government into the fray and the report should be seen as a significant escalation in the ongoing battle between some franchisees and their corporate partners.