Wages
Arizona – Legislation advanced out of a house committee that would place a measure on the Nov. ballot to adjust the state’s tip credit law. Under current law, the tip credit stands at a permanent $3/hr. If approved by the voters, the measure would set a tip credit of 25 percent going forward and is in response to a pending ballot initiative that would increase the state minimum wage while eventually eliminating the tip credit by 2027. More details.
Connecticut – Legislation to eliminate the tip credit by July 1, 2027 advanced out of committee. The bill was expected to advance out of committee, but has an uphill battle going forward. Additionally, the governor has signaled his apprehension toward the proposal but has not definitively stated his position. More details.
Illinois – Pending legislation to eliminate the tip credit was amended to include provisions allowing for a private right of action for violations, and a mandate that all service and delivery charges be allocated toward employee’s tips. It is unclear whether these provisions were added with the intent to negotiate them out later. More details.
New Hampshire – The senate rejected legislation to raise the minimum wage to $15/hr by 2025. Last week, a senate committee voted 3-2 to recommend the full senate reject the measure but under New Hampshire rules, the bill still is entitled to receive a vote on the senate floor. The issue is now dead for the year. More details.
Minnesota – Legislation was introduced to raise the minimum wage to $15/hr on Aug. 1, 2024 and eventually increase it to $20/hr by Aug. 1, 2028. The bill is likely not to go forward in its current form but some changes to the existing law regarding indexing and training wages may result. More details.
Burien, WA – The city council approved an ordinance mandating that as of Jan.1, 2025, the local minimum wage must be $3/hr higher than the state wage which currently is $16.28/hr. Washington does not have a tip credit but the ordinance has an allowance that allows an employer to count tips and benefits toward the new calculation. More details.
Paid Leave
Connecticut – Legislation to expand the state’s current paid leave law advanced out committee. Under current law, employees of businesses with 50 or more employees. accrue paid sick hours at a rate of one hour per every 30 hours worked. Under the legislation, all businesses despite their size would be covered. More details.
Labor Policy
U.S. House – The Committee on Education & the Workforce advanced a Congressional Review Act resolution to repeal a Biden administration rule that makes it more difficult for companies to treat workers as independent contractors rather than their employees. The measure was approved in a 21-13 vote, making it eligible for a vote by the full House. The Labor Department rule took effect March 11 and is widely expected to increase labor costs for businesses in industries that rely on contract labor or freelancers, such as trucking, manufacturing, healthcare, and app-based “gig” services. Even if the resolution passes both houses of Congress, Republicans are unlikely to muster the two-thirds majority needed to overcome a likely veto by President Biden. More details.
California – The state labor commissioner clarified aspects of the bakery exemption embedded in AB-257, the FAST Act passed last year. Among other items, the clarification better defines what qualifies as “bread” for example, saying it must be a single, stand-alone menu item that weighs at least half a pound after cooling. That means restaurants that sell muffins, croissants, scones, rolls, or buns would not qualify for the exemption. Further in order to qualify for the exemption, the bakery must produce bread from scratch, typically from flour, water, and yeast on the restaurant’s premises (and also bake it there). As such, it appears that Panera Bread is not exempted from the law. Recently, a Bloomberg news story had gone viral documenting the close relationship between the governor and a prominent Panera franchisee inferring that the mega-donor received special treatment resulting in the company’s potential exemption from major portions of the law. More details.
California – Legislation is on its way to the governor allowing for some additional exemptions from last year’s FAST Act (AB-257). The new bill, AB-610, also authored by Assemblyman Chris Holden, would carve out new exemptions from the definition of “fast food restaurant,” including “restaurants in airports, hotels, event centers, theme parks, museums, and certain other locations.” Current law exempts only bakeries operating in a prescribed manner and in operation since September 15, 2023, and certain restaurants in grocery establishments. Some unions, notably UNITE HERE, that were not party to the compromise struck last year were critical of the negotiated outcome applying to their members. The governor is expected to sign. More details.
Georgia – Legislation is on its way to the governor that would prevent companies that voluntarily recognize unions from accessing tax credits for mega-projects, such as new automotive plants. The legislation would prevent businesses from receiving state economic incentives if they voluntarily recognize unions through a check of signed union cards rather than through a secret-ballot election. Companies would also be punished for sharing their workers’ contact information with unions, even though doing so is required under federal law under some circumstances. The governor will sign the bill. More details.
Virginia – The governor vetoed legislation that would have barred employers from asking about a job applicant’s salary history and requiring pay information to be included in job listings. The legislation passed along party lines, with support from Democratic majorities in both the assembly and the senate. In a formal explanation of his veto, Governor Youngkin acknowledged the importance of addressing wage disparities, but said that the legislation “represents government overreach, offering incomplete information during the hiring process, disregarding business needs, and potentially exposing small businesses to lawsuits.” He described the legislation as a “one-size-fits-all approach” that disregards the diverse nature of Virginia businesses and that its “potential adverse effects on small businesses, prospective employees, and the economy are too high.” More details.
Labor Activism
Paid Leave – This week more than 70 brands “closed their doors” to promote paid family and medical leave in partnership with the Paid Leave for All campaign. The one-day event aimed to encourage Congress to pass paid family and medical leave for all working individuals. Brands that joined in include a wide variety of maternity, beauty, fashion, and lifestyle companies like Hatch, Tender Foundation, and additionally, ROC United. More details.
Sustainability
Washington – Legislation is on its way to the governor prohibiting the state’s largest utility from hooking up natural gas to any future residential and commercial buildings. It is not an outright natural gas ban as it only applies to future construction and only involves customers of Puget Sound Energy (PSE). More details.
Key Takeaway
- This week, the Minneapolis City Council took the first step in potentially watering down or outright repealing their new minimum wage law for app-based drivers as a result of Uber and Lyft’s promise to pull out of the city. Additionally, it appears Seattle will begin the process of amending their similar law as it has had disastrous consequences for the very workers it was purported to be helping. Not only are these important wins for the app-based networks, they are equally important setbacks for the proponents of sectoral bargaining. Uber and Lyft continue to stand up for themselves and aggressively push back on their detractors with great success. All consumer-facing brands should take note.
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.