Wages
IRS – The Internal Revenue Service (IRS) is considering revamping its tip reporting program. It is seeking public comment on proposed changes to existing voluntary agreements between the agency and service industry employers. The window for public comments closes May 7. The agency contends that advancements in technology and points of sale systems have made existing voluntary agreements outdated. The stated intent of the new SITCA program is to serve as the sole tip reporting compliance program for employers in various service industries and would replace the Tip Rate Determination Agreement (TRDA) and the Tip Reporting Alternative Commitment (TRAC). More details.
Michigan – The coalition advocating for an increase to the state’s minimum wage has officially appealed to the Michigan Supreme Court. It is seeking to overturn a lower court ruling that found the legislature did have the authority to effectively water down a pair of petition initiatives addressing the issue in 2018. The coalition, which includes Mothering Justice, Michigan One Fair Wage, Michigan Time to Care, and the Restaurant Opportunities Center of Michigan, called on the court to restore an earlier ruling the legislature acted unconstitutionally in 2018 when it adopted and amended the petition language to weaken their original intent. More details.
Paid Leave
Maine – A commission appointed by the legislature to examine a potential paid leave program for the state issued its final report. The report recommends that citizens be eligible to take up to 16 weeks of paid leave each year to care for themselves or a family member, with no more than 12 weeks at a time for any particular event. People taking leave would receive a weekly benefit equal to a portion of their typical earnings (either 80 or 90 percent). This benefit would be capped at 120 percent of the state’s average weekly wage (currently this would mean a cap on benefits of $1,240 a week). The program would be funded through payroll contributions, which the commission recommends splitting between employers and employees. The smallest employers (defined as those with fewer than 15 employees) would be exempt from contributing to the fund, though their employees would be fully covered. Legislation should be forthcoming. More details.
Wisconsin – The governor unveiled his fiscal 2024 budget and it included language mandating 12 weeks of paid family and medical leave available to employees in the private and public sectors starting Jan. 1, 2025. Private sector benefits would be funded by employer and employee contributions to a trust fund which would be created with $243 million in one-time seed money from the state. The governor’s office said the program would pay for itself by 2026. The budget would also expand the reasons for which employees can take paid leave, such as a military deployment or the unexpected closure of a child care center. Republicans hold large majorities in both chambers and voiced significant opposition to the proposal. More details.
Labor Policy
Labor Department – After a week of speculation, Secretary Marty Walsh officially announced that he is stepping down from his post to assume the leadership of the National Hockey League Players Association, the union representing the rosters of all 32 NHL teams. Walsh previously headed up the Building and Construction Trades Council in Boston. Walsh is set to leave with several pivotal regulations still in the works at the Labor Department. Those include a proposed rule, initially expected months ago, that would expand the number of workers eligible for overtime pay, and a final rule redefining which workers qualify as independent contractors. His potential departure leaves Deputy Labor Secretary Julie Su, who oversaw the rollout of California’s divisive gig work law, as the agency’s likely acting head. That law, AB-5, established a new three-part test that redefined many of the state’s gig workers as employees. More details.
Labor Department – The nomination of President Biden’s pick to lead the agency’s Wage & Hour Division (WHD) was held up in the Senate HELP Committee and did not advance. The committee split along party lines on whether to approve Jessica Looman to serve as Administrator. Though 11 Democrats voted in favor of Looman’s nomination to the 10 GOP votes in opposition, one of those yes votes (from Sen. Bob Casey (D-PA)) was cast by proxy and cannot be used to break an otherwise-tied vote. Casey was absent due to his recovery from a recent surgery. The committee will likely revisit the nomination when he returns. More details.
Arizona – The Occupational Safety and Health Administration (OSHA) announced that it is withdrawing a proposal to revoke Arizona’s plan for a state occupational safety and health. Arizona is one of 22 states operating its own program, under federal oversight, with the federal OSHA agency handling the rest. The federal decision leaves the Arizona safety and health plan in place with an acknowledgement from Arizona officials that they are addressing deficiencies, including what federal officials said was a downward trend in workplace inspections. Federal officials had asserted that the Arizona program failed, for nearly a decade, to adopt adequate maximum penalties and occupational safety and health standards, including emergency policies tied to the COVID-19 pandemic. More details.
California – A joint employer bill focused squarely on the quick service restaurant sector has been introduced. It would require that a fast food restaurant franchisor share with its fast food restaurant franchisee all civil legal responsibility and civil liability for the franchisee’s violations of prescribed laws and orders or their implementing rules or regulations. The bill would authorize enforcement of those provisions against a franchisor, including administratively or by civil action, to the same extent that they may be enforced against the franchisee. The language is similar to the joint employer language removed from AB 257, the FAST Act. And, the sponsor of the FAST Act is sponsoring this bill. More details.
Shake Shack – The California Civil Rights Department announced it had reached a settlement with Shake Shack to resolve an unnamed former employee’s complaint of discrimination, harassment, and retaliation based on his gender identity and gender expression. The company has been ordered to pay $20,000 to the former employee and will update its company policies after a case of gender discrimination came to light. More details.
Labor Activism
California – In response to the New York Times piece regarding the National Restaurant Association and its ServSafe program, legislation was introduced requiring the Department of Public Health to make a list of all certified food handler training programs along with the cost of each program available on its website by January 1, 2025. Local public health departments would be required to provide a link of this page on their website, or include the same list on their website. In addition, the bill would require an employer to pay the employee for any cost associated with the employee obtaining a food handler card. That includes but is not limited to the time it takes for the employee to complete the training, the cost of the food handler certification program, and the time it takes to complete the certification program. The bill further requires an employer to relieve an employee of all other work duties while the employee is taking the training course and examination. And, an employer would be prohibited from conditioning employment on an applicant or employee having an existing food handler card. More details.
Remedy Coffee – The day after workers walked out of a Buffalo, NY location strike protesting the firing of a worker who was advocating unionization, the company recognized the union without any election taking place. The owners of the coffee shop issued a statement saying they support the staff’s right to organize. This is the latest development in the ongoing unionization of the coffee segment in Buffalo. Both sides will now move toward a bargaining unit. More details.
Starbucks – The company’s CEO Howard Schultz declined an invitation to testify on March 9 regarding the coffee company’s compliance with federal labor law. Last week, Sen. Bernie Sanders, who chairs the Senate Health, Education, Labor, and Pensions (HELP) committee, officially invited him to testify before his committee. The letter, co-signed by all of the committee’s Democratic members, noted that the hearing would “focus on Starbucks’ compliance with federal labor laws.” Sanders had previously voiced his “grave concern about reports that Starbucks is engaging in illegal union-busting tactics in an attempt to intimidate its employees and dissuade them from organizing and joining unions” and called out the company for its “unethical and unlawful anti-union activities.” More details.
Trader Joe’s – Workers at a Louisville, Kentucky store are poised to become the grocery chain’s third store to unionize. Nearly 60 percent of the workers voted to affiliate with the new independent union Trader Joe’s United, which also represents Trader Joe’s workers in Minneapolis, Minnesota, and Hadley, Massachusetts. The company is contesting several yes votes cast in the Louisville election, but organizers predict that the National Labor Relations Board will decide in workers’ favor. Organizers responded that the allegation was ironic, considering that “we have several unfair labor practice charges on file against Trader Joe’s for coercion, intimidation, threats, and surveillance in the weeks leading up to our election.” More details.
Sustainability
Washington – Next week, a house committee will hear pending Extended Producer Responsibility (EPR) legislation. If passed, the bill would create a product stewardship program for packaging and printed paper, including recycling and reuse targets, accurate labeling provisions and requirements for post-consumer recycled content in plastic tubs, thermoform containers (e.g., clamshells), and single-use cups. Additionally, the bill includes a “bottle bill” provision whereby consumers would pay a 10 cent fee on beverage containers and then redeem the 10 cents at drop locations. More details.
Eugene, OR – The city became the first in the state to pass an ordinance prohibiting new natural gas hookups for houses and apartments. Similar legislation is on the books in Washington state and New York City as well as nearly 100 other municipalities across the country. Currently, the state of New York is considering similar legislation as are other cities throughout the nation. The new policy in Eugene takes effect in June, and council members indicated they could consider a similar ban on commercial properties in the coming months. More details.
Scheduling
Colorado – A house committee heard restrictive scheduling legislation and decided to table the legislation after seven hours of testimony, largely opposing the measure. The proposed legislation includes a number of burdensome provisions, including 14 day advance notice, 12 hours of rest time between shifts, and a requirement to offer more hours to part-time workers before hiring new ones. Additionally, employers must provide a worker an hour of “predictability pay” when they add time to a shift or change the location, and two hours salary if they reduce the work time. Sponsors are preparing amendments and the industry must continue to mobilize to impact the outcome. More details.
Key Takeaways
- Colorado has emerged as an early proving ground for the industry in 2023. All brands need to mobilize to impact the scheduling bill under consideration. As drafted, it would become one of the most burdensome mandates in the country. The outcome in Colorado could provide momentum for the issue that is getting renewed interest in state capitols across the country.
- This week, SEIU-backed legislation was introduced in California establishing a $25/hr minimum wage for healthcare workers. Having experienced success in California and elsewhere, expect the labor community to increasingly single out different sectors for mandates. Whereas once it was commonplace for us to rely on state chambers and other broad business associations to manage many of our issues, we may increasingly find ourselves having to “go it alone.”
Podcast
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