Elections
Federal – Heading into Election Day, the presidential contest as well as control of U.S. Congress will likely come down to a handful of contests in a few states. Republican control of the U.S. Senate is the surest bet at this point. Control of the U.S. House and White House may still be undetermined by this time next week. The Align team will provide a state of play report the day after the election and is happy to provide your team any customized analysis as needed.
State – Partisan control of state legislative chambers could flip in a number of states. Two to watch are Minnesota and Michigan where Republicans are hoping to break Democratic trifecta control. If that happens, expect a lot of activity from Democrats during the lame duck period. Labor policy issues including minimum wage, tip credit, paid leave, and captive audience will be on the ballot in a number of states, including Alaska, Arizona, California, Missouri, Massachusetts, and Nebraska. The Massachusetts tipped wage ballot initiative could be a defining moment for the industry. The latest polling indicates that the industry has done a great job educating voters on the potential negative impacts and is in a great position to upset One Fair Wage’s latest campaign at the ballot box. The Align team will also provide state and local state of play reports the day after the election and is happy to provide your team any customized analysis as needed.
Wages
Los Angeles, CA – A city council committee unanimously voted to advance a proposal to the full city council that would raise the minimum wage for hotel and airport workers to $25/hr by Feb. 1, increasing to $30/hr by 2028. Further, the proposal would require employers to provide hotel workers a minimum healthcare benefit payment at the rate of $8.35/hr starting on July 1, 2025. The $25 minimum wage for hotel workers would only be applicable for employer hotels with 60 or more rooms. A vote by the full council has yet to be scheduled. More details.
Paid Leave
Ohio – Republican-sponsored legislation was introduced in the house that would provide a state income tax credit for employers to offer up to eight weeks of paid parental leave. It would include up to $300 per day to private employers that offer their workers parental-leave benefits equal to 100 percent of their pay for a minimum of 56 days after a birth, stillbirth, or adoption of a child. Employers could claim the benefit for multiple employees who take parental leave (at just under $19,000 per employee), but the bill would cap the max benefit for an employer at $54,000 for a year. The sponsors acknowledged that there likely won’t be enough time for the legislature to pass the bill before the current legislative session ends in Dec. but said that he and the bill’s other cosponsors want to “get the legislature talking about it” now, then seek to pass it next year – either as a standalone bill or as part of a new two-year state budget. More details.
Swipe Fees
Illinois – A federal court held a hearing to consider the banking industry’s request for injunction challenging the state’s new law limiting banks from charging interchange fees on tax and tip revenues. The law is set to take effect July 1, 2025, unless the court steps in and blocks the implementation of the legislation. The injunction request is part of a lawsuit filed in U.S. District Court in Chicago, which names Illinois Attorney General Kwame Raoul as defendant. The banking industry contends that the law is preempted by federal banking law while the state contends it is not. The judge did not give an indication on the timing of her decision. More details.
Key Takeaways
- Brands should prepare for a drawn out process to finalize the election results. Control of the White House and the U.S House will likely come down to a few contests and the results will likely be challenged if they are close (as expected). This could lead to protests and potential disruptions in some markets.
- There are a few things to watch for at the state level on Election Day. First, any states where trifectas are broken (Democrat or Republican) are likely to see activity during lame duck (or, potentially a special session) to rush through policy priorities. Second, any state where new trifectas are created or broken will have a dramatically different policy environment in 2025. Finally, broken or newly created supermajority control in legislative chambers can create massive procedural advantages for governing caucuses. Beyond partisan splits, the personalities and policy priorities of newly-installed leadership will be the greatest determinative factor of the 2025 policy environment. In some states, the focus of new leadership may not be fully apparent until legislatures begin convening in 2025.
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.