Wages
Massachusetts – Two bills were introduced that would dramatically affect both the minimum wage and the tip credit. One bill would incrementally raise the minimum wage to $20/hr as well as increase the server wage from its current $6.25/hr to $12/hr. The other would create a 19 percent minimum gratuity on all parties with more than four people if they are dining during “peak restaurant season.” Per the bill, peak restaurant season would be voted on by a local city’s council members or in a town by their select board. For context, last Nov. voters overwhelmingly rejected a ballot measure to eliminate the tip credit. Both pending bills face an extremely uphill battle for passage. More details.
Virginia – Leveraging their recent election success, Democrats have pre-filed legislation in advance of the 2026 legislative session that would raise the minimum wage to $15/hr by 2028. The senate sponsor is the Finance & Appropriations Committee Chair. Attempts in recent years to raise the minimum wage passed out of the legislature but were vetoed by the outgoing governor. The incoming governor, Abigail Spanberger, has vowed to sign any minimum wage bill that reaches her desk. She has not, however, weighed in on any tip-related issues. More details.
Tacoma, WA – A local union-backed ballot measure, which includes a $20/hr minimum wage and a Workers Bill of Rights, will not appear on the Feb. 2026 ballot. The city sued to stop the measure from proceeding to the ballot concerned over the potential impact to city operations, as well as employers. City leaders wanted more time to examine the potential impacts. The stay is temporary, and courts will continue to discuss the measure into the spring of 2026. On a related note, voters in Olympia, WA rejected a similar measure earlier this month that included an increase in the wage to $25/hr. More details.
Boulder County, CO – The county commission voted to abandon their current minimum wage law in favor of a less aggressive ordinance. In 2023, the county adopted a wage schedule that would see the wage for unincorporated parts of the county rise to $25/hr by 2030. Citing significant pushback from the business community, local officials have held numerous hearings in an effort to modify the law. The new provision calls for a $16.82/hr wage by 2026 and then indexed to inflation thereafter. The city of Boulder’s current ordinance calls for an $18.93/hr rate by 2030 and then ties the wage to inflation thereafter. The tip credit would remain at the statewide standard of $3.02/hr. More details.
Paid Leave
Virginia – Legislation has also been pre-filed to broaden the existing state paid leave law that currently applies only to home health care workers. Under the proposal, employees of all private employers and state and local governments can accrue one hour of paid leave for every 30 hours worked. In addition to using paid sick leave for their physical or mental illness or to care for a family member, an employee may use paid sick leave to seek or obtain certain services or to relocate or secure an existing home due to domestic abuse, sexual assault, or stalking. The bill authorizes the Commissioner of Labor & Industry, in the case of a knowing violation, to subject an employer to a civil penalty not to exceed $150 for the first violation, $300 for the second violation, and $500 for each successive violation. Additionally, the bill authorizes an aggrieved employee to bring a private right of action against the employer in which the employee may recover double the amount of any unpaid sick leave and the amount of any actual damages suffered as the result of the employer’s violation. The bill has a delayed effective date of July 1, 2027. Like minimum wage legislation noted above, similar bills in previous sessions have been vetoed by the governor but the incoming governor has vowed to sign this proposal. More details.
Labor Policy
U.S. Senate – The Health, Education, Labor & Pensions (HELP) Committee once again delayed the nomination of Scott Mayer to the National Labor Relations Board (NLRB). During a hearing last month, Mayer, who is the general counsel for Boeing, got into a heated exchange with U.S. Senator Josh Hawley (R-MO) regarding the company’s ongoing dispute with unionized workers at its St. Louis area facilities. Because that strike has since been settled and a new labor deal is in place, observers felt that Mayer’s nomination would now move forward. In the hearing this week, the nomination was brought up and subsequently delayed several times due to procedural motions by U.S. Senator Bernie Sanders, the committee’s lead Democrat. Sanders was protesting the president’s firing of former Board member Gwynne Wilcox. It is unclear when the nomination will be further considered. More details.
U.S. House – The Committee on Education & Workforce advanced three employer-friendly bills this week. One of the bills permanently establishes the Payroll Audit Independent Determination (PAID) program, which the Labor Department (DOL) recently re-launched. This program allows employers to voluntarily self-audit and report potential minimum wage, overtime, and certain Family and Medical Leave Act (FMLA) violations to the Labor Department to resolve them without litigation or penalties. Another bill, the Tipped Employee Protection Act, would permanently prevent the Labor Department from enacting an 80/20/30-style rule. The controversial rule limits the amount of time tipped employees can spend on non-tipped “side work” to 20 percent of their shift, among other stipulations. It also clarifies the definition of a tipped employee and preserves the tip credit. And lastly, the Faster Pay for Workers bill would ensure workers receive pay faster when payroll mistakes occur. The bills advanced on a party-line vote but chances for progress in the senate remain unclear. More details.
Washington – Deriding the Trump Administration’s current level of wage enforcement and the defunding of key labor agencies, the state attorney general announced a new “Worker Right’s Unit” within his office to combat wage theft and sustain the state’s “nation-leading worker protections.” The new Worker Rights Unit will work alongside the Seattle City Office of Labor Standards and the state’s Department of Labor & Industries. Types of wage theft that the agency will focus on include workers not being allowed to take mandatory breaks or lunch, not receiving earned tips, and getting paid less than the minimum wage. More than a dozen other state attorneys general have similar units centered on pro-worker rights litigation according to the attorney general’s office. More details.
Labor Activism
Las Vegas, NV – Last week, about 400 workers across 20 restaurant and retail brands set a strike date of Nov. 14 if their contract demands were not met. With no progress made, workers this week began walking picket lines, initially focusing on airport concessions and Allegiant Stadium. The workers are being represented by the Culinary Workers Union. While most airport workers under HMSHost have contracts with better wages and benefits, the union says employers operating under the Disadvantaged Business Enterprise program lag behind in pay, health care, and pension contributions. Despite a 2024 court ruling that found that these businesses are in fact not disadvantaged, their pay and benefits continue to lag. Brands involved include Wendy’s, Jamba Juice, and Jersey Mike’s among others. Ongoing worker actions may range from targeted walkouts to a complete work stoppage during the busy upcoming travel season. More details.
Los Angeles County – A coalition of labor activists led by One Fair Wage announced that they are pressuring the county board to take up a proposal to increase the minimum wage to $30/hr soon, phasing the increase in over roughly five years for businesses operating in unincorporated areas of Los Angeles County. The $30/hr wage would become the highest minimum wage in America. The state of California’s minimum wage of $17/hr is more than double the national benchmark of $7.25/hr and the state has no tip credit. More details.
Starbucks – One week into what baristas have threatened to make the “largest, longest” strike in Starbucks’ history, the Workers United union said it is adding more than two dozen new cities and stores to its strike count. The union said this week it will now be striking at 95 stores in 65 cities, with some 2,000 baristas now engaged in the action. A company distribution center in Pennsylvania was targeted as well. The union said the majority of stores where strikes were held had to close down on the first day of the strike due to staffing issues, and the lack of workers impacted some 50 locations in the days to follow. The company said stores that had issues were often able to reopen quickly and that less than 1 percent of its locations are experiencing disruption from the strike. In a related note, last week 26 U.S. Senators and 82 U.S. House Representatives signed a letter to the company urging the company and its CEO Brian Niccol to “stop its illegal union-busting campaign and negotiate a fair contract with its workers.” More details.
Key Takeaways
- The conversation around the minimum wage has taken a sharp turn in the last year. 15 states and the District of Columbia currently have a minimum wage of $15/hr or higher with four more rising to that level by 2027. But labor community activists and their progressive allies in office have begun to abandon the “Fight for $15” and set their sights on significantly higher wage levels. Against the backdrop of the affordability crisis, the debate over a $30/hr wage level is on full display in New York City, Los Angeles, and San Francisco among others. $25/hr is being discussed in Maryland and cities like Olympia, WA. While it’s easy to dismiss such seemingly impractical wage rates, the industry similarly scoffed at $15/hr not too long ago which has now become the 50-yard line of the conversation. As inflation continues to be a pernicious challenge increasing food, housing, and healthcare costs at rates far in excess of wage growth, jurisdictions will be under tremendous pressure to respond and wage hikes will be at the top of their list of remedies.
- In addition to being central to the wage issue noted above, the industry was thrown into the affordability issue yet again this week, but this time from the pricing side and by none other than President Trump himself. Speaking to a summit of McDonald’s franchise owners, operators, and suppliers on Monday, Trump said, “I want to give a very special thanks to McDonald’s for slashing prices for your most popular items, bringing back Extra Value Meals.” McDonald’s brought back Extra Value Meals at $5 and $8 beginning in Sept. for the first time since 2019. McDonald’s has become a barometer for consumer sentiment especially among lower-income customers due to its large footprint across the country. The Economist’s Big Mac Index which tracks the price of a McDonald’s Big Mac burger in different countries, has also been used as an informal measure of purchasing power parity around the world. As of July, a Big Mac in the U.S. cost $6.01, an increase from $5.69 a year ago. While McDonald’s willfully associated themselves with the President on this issue, other brands (Walmart) have received negative attention from the White House regarding their pricing decisions to accommodate Administration policies like tariffs. Brands should be aware that while consumers have always paid close attention to prices, politicians have not. Until now.