Ukraine
Starbucks – The company announced it will suspend operations at its 130 stores in Russia, pulling the brand out of the market completely. They will, however, offer job assistance and pay the company’s nearly 2,000 workers in Russia for six months. Starbucks joins McDonald’s and industry suppliers Coca-Cola and Pepsi in deciding to exit the market. More details.
Minimum Wage
Apple – The company announced that it will increase pay for corporate and retail workers later this year, raising the starting wage for its retail employees in the U.S. to $22/hr, up from $20/hr. Stores in certain regions may have even higher starting pay. The increase in retail salaries was announced as Apple faces retail union drives across the country, asking among other items for higher wages. Employees at a store in Atlanta, Georgia will vote in June whether to organize with the Communication Workers of America (CWA). More details.
Bank of America – The company said it was raising its U.S. minimum hourly wage to $22/hr, a step closer to its promise of paying workers $25/hr by 2025. The second-largest U.S. bank by assets has been steadily raising its minimum hourly wage since 2017. At that time, it was $15/hr. The company has been at the leading edge of banks raising base pay for hourly workers. Last year the bank pledged to pay its workers at least $25/hr by 2025, the highest minimum wage of any big retail bank. It also began requiring its vendors to set a minimum wage of $15/hr. More details.
Labor Policy
California – Next week, the Senate Committee on Labor, Employment & Retirement will hold a hearing on AB 257, the Fast-Food Accountability and Standards (FAST) Recovery Act. Among other provisions, it would create a Fast-Food Sector Council that would establish wage and benefit rates and other workplace standards for quick service restaurants. This concept – often referred to as sectoral bargaining – is popular among labor advocates. It will likely pass out of this committee but there are at least two other committee stops before going to the senate floor. More details.
California – The senate approved expansive new equity legislation and the bill now moves to the assembly for consideration. The senate-approved version would require that all employers with 15 or more employees provide the pay scale for any open positions in job postings. Additionally, it would require those employers to provide, upon request, the pay scale for any position for which a person is currently employed. It further requires an employer to maintain records of a job description and wage rate history for each employee for the duration of their employment, plus 3 years. These records will be open to the Labor Commissioner for inspection. It also allows an aggrieved worker to file a written complaint with the Labor Commissioner within one year after the date the worker learned of the violation. Most importantly, if passed, after one year, the information will be available to the public. More details.
Labor Activism
Great Lakes Coffee – In what is likely to precipitate action by the National Labor Relations Board (NLRB), one unit of a small but popular Detroit-based coffee chain that was undergoing a unionization effort permanently closed their doors. The unit had been closed since Jan. 7, following an outbreak of COVID-19 among nine staff members. While the closure was initially thought to be temporary, it lasted for months as the workers complained of unsafe conditions and stayed home. Through their attorneys, the owners have stated that they (the coffee shop) weren’t making money and they couldn’t find people that felt comfortable to work (because of the Omicron variant), and that customers felt the same way; therefore, the closure was justified. This case should be watched closely for a myriad of potential precedents. More details.
Starbucks – A regional official with the National Labor Relations Board (NLRB) is seeking to order Starbucks to recognize and bargain with a union at a store outside of Buffalo, NY, despite organizers’ losing an election there last year. The agency filed an amended complaint with an administrative law judge arguing that some of Starbucks’ actions as part of its anti-union campaign were so egregious “there is only a slight possibility of erasing their effects and conducting a fair election.” Workers at the Hamburg store had voted 12-8 against organizing under Workers United back in December. The complaint argues that the union authorization cards signed by workers there are a better reflection of their wishes. The filing updates a complaint issued earlier in the month that alleged a litany of labor law violations. Starbucks has denied the NLRB’s claims. In related news, the NLRB postponed a revote in a Memphis store stating that only three ballots had been received by their New Orleans office and that, “As of this morning, the New Orleans regional office had only received several ballots, which is unusual for a voting unit of this size, and often signals there has been a delay in mail delivery.” The vote will now be tallied June 7. To date, over 270 stores are in the process of holding a union election with 98 units having voted to unionize, 12 have rejected the union, and seven outcomes are still undecided. More details.
Alcohol
California – The senate approved legislation that expanded provisions of a 2021 law allowing the sale and delivery of to-go cocktails. The bill was approved unanimously, on a 32-0 vote. This year’s bill expands that legislation so that consumers can buy to-go drinks without ordering a meal along with it. More details.
Sustainability
McDonald’s – Shareholders re-elected all of McDonald’s directors this week, ending a boardroom battle with billionaire investor Carl Icahn who had sought to win two board seats and shine a spotlight on his campaign over animal welfare. Preliminary tallies showed shareholders backed all 12 of McDonald’s directors and that Icahn’s two nominees received approximately 1 percent of the vote, the company said. Icahn, who owns roughly $50,000 worth of McDonald’s stock, nominated two candidates to push the company to make good on a decade-old promise to stop buying pork by the end of this year from suppliers that house the animals in crates. More details.
Key Takeaways
- The hearing next week on the California FAST ACT could be a good indicator of the likelihood of industry success in defeating this onerous legislation. The labor committee will almost certainly advance the bill but the bill has two additional committee stops and it is critically important that we “show well” during the committee hearing next week. Lawmakers need to understand how damaging this legislation will be to thousands of small business owners throughout the state. We may lose this particular battle – but we have to fight as hard as possible so as to better position us to win the broader war. This bill is probably the most onerous legislation facing the industry throughout the 50 states so far this year. The industry has to do everything possible to aggressively advocate for its defeat.
- The significant recent rise in shareholder, employee, and investor activism throughout Corporate America is unprecedented – especially in the realm of climate and social politics. In the last few weeks, the abortion issue has been front and center and eclipsed only by recent gun-related tragedies in Buffalo, NY and Uvalde, TX. While separate and distinct, both are leading to increased pressure on leading companies to engage in some fashion. This week alone, there has been significant media coverage on the issues, including this article in Roll Call. While most companies will rightfully want to avoid going anywhere near these issues, they may be pulled in against their will and 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.