Election 2022
State-Level Contests – Most pundits are focused on control of the U.S. Senate; however, changes of partisan control at the state level are potentially of greater consequence to the employer community. Blue trifecta states (Democrat control of both legislative chambers and the governor’s mansion) historically have been the most problematic for wage and benefit issues – like the FAST Act or elimination of the tipped wage. Almost certainly the business community will be grappling with two new blue trifectas after Election Day, Maryland and Massachusetts. Michigan is the only other state for which Democrats have a decent chance at securing trifecta control. Democrats will look to break Republican trifecta control in Arizona by taking the governor’s mansion. Republicans, for their part, are pressing their advantage and hope to break blue trifectas in Nevada, New Mexico, and Oregon. And, Republicans may gain trifectas in Kansas and Wisconsin. Another trendline to watch is states where either party gains supermajorities in legislative chambers. The Align team will provide a full readout the day after the election. More details.
Ballot Measures – Over 130 ballot measures will appear on this year’s ballot. The industry is most closely watching the wage measures in Nebraska, Nevada, D.C., and Portland (ME). The $12/hr measure in Nevada and the $15/hr measure in Nebraska will serve as a measuring stick for how the issue plays across the country. If a $15/hr measure is approved by Nebraska voters then it’s difficult to imagine that the labor community will not press for a $15/hr minimum wage in every jurisdiction in future cycles. More details.
U.S. Supreme Court
Affirmative Action – In perhaps the most closely watched case this year, the U.S. Supreme Court seems poised to end race considerations in college admissions. Some companies are arguing in support of existing affirmative action policies, stating that campus diversity is critical so that companies have a diverse hiring pool. Without it, they are concerned they may not be able to hit diversity goals in the future. The court heard oral arguments this week and won’t rule on the case until the summer. More details.
Covid – 19
Restaurant Revitalization Fund – A bipartisan group of lawmakers rebuked the Small Business Administration (SBA) this week, calling the agency’s failure to release tens of millions of dollars in unspent funds “inexcusable.” A July report from the Government Accountability Office (GAO) found that SBA was still sitting on money for the program, and dozens of lawmakers called on the agency to quickly get those funds out the door. The agency committed to doing so but progress has been slow prompting this week’s criticism. More details.
Wages
Ohio – The attorney general approved a petition for a ballot initiative seeking to increase the state’s minimum wage to $15/hr by 2028. The proposal, backed by a coalition of advocacy groups called Raise the Wage Ohio, is still in the early phases of the long process of getting on the ballot. The next step in the process is an assessment by the Ohio Ballot Board, which must determine whether the petition contains a single constitutional amendment or multiple amendments. If the board certifies the proposal, the petitioners can begin to collect signatures from registered voters from across the state. The attorney general had previously rejected a proposal back in Oct. when it was first submitted over sections that didn’t include or conflicted with relevant existing law and parts of the Ohio Constitution, among other issues. He has now approved the revised language. Ohio’s current minimum wage is $9.30/hr, and $4.65/hr for tipped workers. If approved in the next election following this year, the minimum wage would increase to $10.50/hr on Jan. 1, 2025 and incrementally increase to $15/hr by Jan. 1, 2028. It would then increase each year based on annual cost of living increases (beginning Jan. 1, 2029). The tip credit would be fully eliminated by that date as well. More details.
Labor Policy
NLRB – National Labor Relations Board (NLRB) General Counsel Jennifer Abruzzo is targeting workplace surveillance technology. In a memorandum this week she is “urg[ing] the Board to apply the Act to protect employees, to the greatest extent possible, from intrusive or abusive electronic monitoring and automated management practices that would have a tendency to interfere with Section 7 rights.” Effectively, Abruzzo is seeking to put the burden on employers to demonstrate why such monitoring is necessary for business operations. Employers would have to demonstrate that the technology is used in a manner that is not burdensome to workers’ NLRA rights. Additionally, the NLRB majority has begun the process to overturn changes to union decertification procedures that were enacted under the Trump-era NLRB. The new rule would rescind current policies on “blocking charges” and voluntary regulations, allowing for unions to stop decertification votes while the NLRB reviews potential unlawful conduct. Under the new standard, a Regional Director may delay the election if he/she determines that the alleged conduct threatens to interfere with employee free choice. Secondly, the proposed rule would change the procedures when an employer voluntarily recognizes a union. The Trump Board created a notice-and-election procedure whereby the union would have to demonstrate a showing of majority support among employees via a secret ballot election. The new rule would prevent challenges to the status of the newly recognized union until a “reasonable period” for collective bargaining has passed. More details.
Connecticut – The U.S. Chamber of Commerce and numerous other state and national trade associations filed a federal lawsuit against Connecticut regarding its new “captive audience” law that prevents employers from requiring employees to remain at meetings where they impart political or religious views. The law, which was a victory for labor unions, went into effect in July making Connecticut only the second state after Oregon with a so-called captive audience law currently on the books. The lawsuit argues “employers have the right to communicate with their employees about the employers’ viewpoints on politics, unionization, and other labor issues, as well as the right to require employees to attend meetings or otherwise view communications about those issues.” More details.
Labor Activism
Home Depot – Workers at a store in north Philadelphia started voting this week to join Home Depot Workers United, a new independent group formed at the store. Organizers say that during the COVID-19 pandemic, many workers felt exploited by the lack of staffing and additional workload requests. That included working in different departments with little training and lack of compensation accounted for in the end. The results are expected Saturday night. More details.
Trader Joe’s – Employees at a Brooklyn store voted 94-66 against joining the independent Trader Joe’s United union. Earlier this summer, workers at two stores created the first union foothold among the company’s over 500 stores. The Brooklyn site employs around 185 workers and some complained that they have faced racial discrimination, poor working conditions, and, lately, union busting while working for the company. In related news, employees at a Hadley, MA store, the first in the chain to vote to unionize, met with company negotiators this week to seek agreement on a collective bargaining agreement. More details.
Misc.
Mesa, AZ – The city conducted a public hearing on a proposed ordinance to significantly curb development of new-drive thru restaurants. Existing units would be grandfathered. The city is proposing that new development that includes a drive thru must seek additional permitting giving the city an opportunity to turn down certain projects – or potentially concepts or brands. The business community has mobilized to oppose the ordinance. More details.
Key Takeaways
- After Election Day, the industry should immediately begin preparing for 2023 legislative fights (and potentially in lame duck sessions). The FAST Act, tipped wage, and franchise bills are likely to emerge in a number of jurisdictions. Many brands and the industry have proactively been doing outreach to legislators, expecting challenging environments in places like Illinois, New York, and Washington state. If the industry does not engage in a collective proactive effort targeting moderate, swing state senators in those states then we are likely to find ourselves on the defensive again in 2023.
- With election day next week, employers may be faced with unexpected requests from workers to take time off to vote in person. Any misstep by unit managers, either real or perceived, could quickly escalate into national press coverage. Companies should reaffirm their policies and procedures in this space to both field management and employees alike.
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.