Wages
New York – Both the senate and assembly unveiled their budget resolutions this week and both chambers included language supporting a higher minimum wage than the current $15/hr in the New York City area and $14.20/hr north of Westchester County. The language also links future increases to the rate of inflation. The move could give lawmakers flexibility in the upcoming negotiations with Gov. Kathy Hochul, who has backed indexing the wage to inflation. At the same time, the proposals do not explicitly embrace recently-introduced legislation that would raise the wage to $21.25/hr by 2027. More details.
Paid Leave
Illinois – The governor signed legislation making Illinois the third state (following Maine and Nevada) to allow paid leave for any reason. The new law will provide nearly all Illinois workers with a minimum of 40 hours of paid leave, or a pro rata number of hours, during a designated twelve-month period. Under the Paid Leave for All Workers Act (PLAW), employers can choose to frontload the leave on the first day of employment or the first day of a designated twelve-month period or use an accrual method. Leave accrues at the rate of one hour of paid leave for every forty hours worked. The law will deem exempt employees to have worked 40 hours in each workweek for purposes of accrual, unless their regular workweeks are less than 40 hours. Once enacted, the law will permit employees to use leave after 90 days on the job, unless an employer allows them to utilize leave earlier. Employees may determine how much leave to use, but employers may set a reasonable minimum increment of no less than two hours per day. The law will take effect on Jan. 1, 2024. More details.
Minnesota – A senate committee gave a “do pass” recommendation to house-passed legislation that would give workers up to 12 weeks paid family leave and up to an additional 12 weeks paid sick leave. The bill now heads to an additional senate committee. Also of note, similar language is being inserted into the state budget proposal. More details.
Labor Policy
California – A state appeals court said that Uber, Lyft and other platform companies could continue to treat their workers as independent contractors under a California ballot measure known as Proposition 22, though it asked that a clause which put restrictions on collective bargaining by workers be severed from it. Proposition 22, which passed in November 2020, allowed these companies to continue leveraging the independent contractor model instead of classifying their drivers as employees.. A California court deemed it unconstitutional in 2021. This week’s order reversed parts of that lower-court ruling. The SEIU is considering appealing the decision to the state supreme court. More details.
Michigan – The senate advanced house-passed legislation to repeal the state’s right-to-work law. Established by Republicans in 2012, the law allows workers in unionized jobs to opt out of paying union dues and fees. Michigan, a state steeped in labor history, could become the first state in nearly 60 years to reverse its right-to-work law. Late in the process house leaders added a $1 million appropriation to the Department of Labor and Economic Opportunity to respond to public questions about the legislation and implement it. The appropriation means that the legislation is not subject to a public referendum in which voters could reject the law. The governor is expected to sign the bill. More details.
Oklahoma – Legislation to lower the allowable age for employees to serve cocktails passed the senate and is pending in the house. The current age for servers to handle mixed drinks is 21 but the legislation calls for lowering that to 18. More details.
Labor Activism
California – A hearing will be held next week on legislation 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. The bill was originally filed in response to the New York Times piece regarding the National Restaurant Association and its ServSafe program. More details.
Starbucks – Both of New Jersey’s U.S. Senators, Robert Menendez and Cory Booker, sent a letter to Starbucks’ chief executive, Howard Schultz, calling for him to stop delaying the negotiations with unions at four New Jersey stores. Menendez and Booker urged Schultz to follow federal law and to bargain in good faith. In their letter, the senators said the employees “demanded commonsense requests” such as better training, health and safety improvements, benefits for part-time work and raises for increased workloads. More details.
Sustainability
California – A 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. Similar legislation has been introduced in New York. More details.
Washington – A senate committee heard house-passed legislation banning the state’s largest utility, Puget Sound Energy, from extending natural gas hookups to any new buildings as of July 1. If passed, it will be illegal for builders to place natural gas or propane in new construction as a primary source of energy. Instead, they are required to install a heat pump for both space and water heating. The code regulation allows natural gas as a backup energy source. The heat pump requirement is estimated to add $9,200 to a new home price. The legislation is codifying new regulations promulgated by the Washington State Building Code Council which sought a statewide standard since numerous jurisdictions, including Seattle, had adopted their own similar ordinances. More details.
Washington – Legislation creating an Extended Producer Responsibility (EPR) program failed to meet the March 10 crossover deadline and is dead for the year. If passed, the bill would have created 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 included a “bottle bill” provision whereby consumers would pay a 10 cent fee on beverage containers and then redeem the 10 cents at drop locations. Expect the legislation to be reintroduced next year. More details.
Misc.
Tennessee – Legislation was tabled in a senate committee mandating that state and local taxes be excluded from the calculator of credit card interchange fees. The bill will likely be re-introduced next year. More details.
Key Takeaways
- A new study released by the labor-funded UC Berkeley Center on Wage & Employment Dynamics “found” that higher wages make it easier to recruit and retain workers thereby improving turnover rates and that the workers themselves are likely to be a little more productive. The findings should be surprising to no one – for years, their studies have been the academic basis for much of the labor community’s narrative on the subject. But this new working paper is the first ever to examine the impact of higher minimum wages on small, low-wage businesses, a sector that includes restaurants, grocery and retail stores, and child care operations. It’s the second recent study by the authors that challenges the conventional wisdom on minimum wages. Expect this study to be front and center in state capitols as “evidence” from the labor community as to why FAST Act copycats should be pursued and tip credits eliminated. You can find the study here.
- New polling in Massachusetts shows that 59% of respondents support an increase in the state minimum wage to $20/hr. The current wage reached $15/hr earlier this year. Last week, labor activists filed paperwork to begin the initial process of placing a $20/hr measure on the 2024 ballot and there is legislation to get to the level by 2027, indexing to inflation thereafter. Some observers feel that the pending ballot question is merely a tool to force the issue legislatively. The learning is that the labor community is quite serious in their pursuit of a significant wage hike in the state and being the highest in the country by far. The industry should prepare accordingly.
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.