COVID-19
Federal Relief – The U.S. Senate Committee on Small Business & Entrepreneurship convened a hearing to discuss the U.S. Small Business Administration’s (SBA) COVID Economic Injury Disaster Loan (EIDL) program. Committee members urged the SBA to use their statutory authority and finish processing applications and distribute the $800 million left in the EIDL subsidy, which could provide more than $7 billion in loans to the 166,000 small businesses that either were approved and never received a loan, or never received a response from their application. The COVID EIDL program was created by Congress in March 2020 to provide fixed rate, low interest, long-term capital to small businesses struggling due to the pandemic. Since the beginning of the pandemic, the program has provided loans to 4 million small businesses totaling nearly $380 billion. According to the SBA, there are still approximately 125,000 COVID EIDL applicants whose applications were approved but funds have not been disbursed as well as an additional 41,000 applicants who have never received a decision. More details.
Wages
Portland, ME – The city council approved five measures to proceed to the Nov. ballot including an initiative to mandate an $18/hr local minimum wage and eventually eliminate the tip credit after three years. Proponents turned in 2,000 signatures supporting the measure, well in excess of the 1,500 necessary to qualify. More details.
Taxes
Inflation Reduction Act – The U.S. Senate passed the Inflation Reduction Act which, among other provisions, would significantly increase corporate taxes. The bill also contains major climate-related provisions and expands the Affordable Care Act. Much of the business community, including the National Restaurant Association, has voiced opposition to the bill. The U.S. House is poised to pass the bill later today. More details
Labor Policy
OSHA – The Occupational Safety and Health Administration (OSHA) announced it is reopening the comment period for an additional 60 days on the proposal to reconsider and revoke the final approval of Arizona’s State Plan for Occupational Safety and Health. The agency is also postponing the public hearing tentatively scheduled for Aug. 16, 2022. In May, the Labor Department announced a proposal to reconsider and revoke final approval of Arizona’s State OSHA plan, which the department says is in response to nearly a decades-long “pattern of failures” to adopt and enforce standards and enforcement policies that are at least as effective as those used by OSHA. Further notice of the actions are expected to be published in the Federal Register within the next few days. OSHA plans to review all comments on the proposal, including any submitted during the reopening of the comment period. Further decisions about scheduling a hearing are suspended until then. More details.
California – The FAST Act advanced out of the Senate Appropriations Committee and is headed to the senate floor which must pass it by the end of the month. Because the senate version of the bill differs from the house version, the differences must be reconciled. The likely scenario is that the house picks up and approves the senate version. Because the more onerous provisions of the bill were not watered down in committee, it improves the chances of killing the legislation on the senate floor. It is unclear whether there are currently enough votes to defeat the legislation. More details.
California – An assembly committee gutted legislation that would have forced companies with 100 or more employees to publicly post pay data and workforce demographic information. Current law mandates employers with 250 or more employees submit similar data to the state for aggregation but the information and the companies names are not made public. The pending legislation would have made that information publicly available. It is unclear if the bill will proceed in its new form. More details.
New York – The governor signed a bill that directs the state labor department to conduct a study on the statewide employment rate of transgender individuals in consultation with the Division of Human Rights. The study will be used to determine whether there is a disparity in employment rates between transgender New Yorkers and other residents. According to the governor, the statewide survey will inform future legislation. More details.
Chipotle – The company reached a nearly $20 million settlement with New York City over violations of worker protection laws. It’s the largest settlement of its kind in the city’s history. The city said the settlement covered violations of scheduling and sick leave laws from late Nov. 2017 to late April of this year. Under the settlement, hourly employees of Chipotle in New York City will receive $50 for each week that they worked during that period. Employees who left the company before April 30 will have to file a claim to receive their compensation. The Fair Workweek Law enacted by the city in 2017 requires fast-food employers to provide workers with their schedules at least two weeks in advance or pay a bonus for the shifts. Employers must also give workers at least 11 hours off between shifts on consecutive days or get written consent and pay them an extra $100. And the employers must offer workers more shifts before hiring additional employees. More details.
Labor Activism
Intelligentsia Coffee – Workers at five Chicago cafes voted to unionize, becoming the latest group of workers in the coffee sector to organize. The final vote tally at Intelligentsia was 9-1 in favor of affiliating with Local 1220 of the International Brotherhood of Electrical Workers (IBEW). Intelligentsia’s bargaining unit will actually include 27 workers, but a snafu over outdated mailing addresses meant that some employees didn’t get their ballots in time to vote. Of note, the union argued – and the National Labor Relations Board (NLRB) concurred – that all five units be treated as a singular bargaining unit. In the case of Starbucks, that company has similarly argued that units in a given geographical area be treated as a single unit and the Board has rejected that argument in favor of single location bargaining units. More details.
Lululemon – The NLRB has set an election date of Aug. 25-26 for workers at a location in the Georgetown area of Washington, DC. According to their previous NLRB petition, they are filing under the name of the “Association of Concerted Educators.” This is likely due to the fact that workers in sales positions in Lululemon’s brick and mortar stores are referred to as “educators” by the company. Wages at the store range from $15/hr-$17/hr but the workers appear to be frustrated not with wages and benefits but with the company culture and a perceived lack of inclusiveness. If successful, it would be the first of the 315 U.S. locations to unionize. More details.
Starbucks – This week, a video of a walkout by workers at a Buffalo, NY store in protest of the firing of a worker amassed 20 million views on Tik Tok, an example of the viral nature of modern day union organizing. The worker has accused the company of firing him in retaliation for his union organizing activities while the company contends it was for repeated violations of store closing policies. To date, workers at 219 Starbucks in 33 states have won union elections while 46 have rejected a union. More details.
Trader Joe’s – The NLRB has begun the process of tallying votes of workers at a Minneapolis unit. If successful, it would be the second unit to organize with a third currently pending in Boulder, CO. More details.
Via 313 – Employees of three Austin, TX area locations of the pizza restaurant filed a petition with the National Labor Relations Board (NLRB) to conduct a unionization election. Employees had been organizing for the past year and a half alleging issues with COVID-19 transparency and safety concerns over the 2021 holiday season during the Omicron variant surge. In response, 46 employees from various Austin locations created a petition asking for sick and hazard pay and better COVID safety measures such as pausing indoor dining during variant surges and only letting staffers who contract COVID return to work after a negative test result and 24 hours without a fever. Frustrated with the responses from the company, employees over the last eight months began circulating petitions, staging walkouts and protesting company policies leading to suspensions and other disciplinary actions by the company. The union petition filed this week is the culmination of those actions. More details.
Data Privacy
Federal Trade Commission – The agency announced it is seeking public comment regarding its advance notice of proposed rulemaking (“ANPR”) on commercial surveillance and data security. The FTC defines “commercial surveillance” as the business of collecting, analyzing, and profiting from consumer data. Specifically, the FTC seeks comment on whether the Commission should implement new rules concerning the ways in which companies (1) collect, aggregate, protect, use, analyze, and retain consumer data, as well as (2) transfer, share, sell, or otherwise monetize consumer data in ways that are unfair or deceptive. The comment period is slated for 60 days. More details.
Sustainability
Massachusetts – The state has agreed to put off enforcement of a state law requiring pigs be raised humanely at least until the U.S. Supreme Court can review a similar law’s constitutionality. The U.S. Supreme Court is currently reviewing a California law that is similar to the Massachusetts law in the case National Pork Producers Council v. Ross. The court is scheduled to hear arguments on that case on Oct. 11 and the court typically releases its opinions within 90 days of hearing arguments. Pork producers and state restaurant associations in five of New England’s six states sued Massachusetts over the regulations which had been set to go into effect next week which would require pork shipped through the state to come only from pigs raised with a certain amount of space and the ability to lie down. The trade groups argued this violates the interstate commerce provisions of the Constitution, both because almost all our pork comes from other states and because the regulations would have applied to Massachusetts warehouses that supply restaurants and stores in Vermont, New Hampshire, Rhode Island, and Maine. More details.
Key Takeaways
- Brands should take note of the nature of the union organizing activity currently underway in Austin, TX. The organizers have pledged to look beyond their own company stores and have committed to organizing the pizza sector across the city. Given a city with the local demographics and politics of Austin, this could spread quickly and envelop other sectors of the industry. Brands should watch this effort closely over the next few months.
- Full-service brands need to pay attention to the renewed efforts by the entrenched liquor establishment to push back on pandemic-era gains by the industry, especially with regard to cocktails to go and home delivery of alcoholic beverages. Package store and tavern owners are co-opting health research showing significant increases in alcohol-related deaths and rising addiction rates blaming home delivery in particular. In 2023, brands serving alcohol should be prepared for numerous legislative battles across the country as traditional alcohol retailers push back.
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.