Wages
Washington, DC – A judicial panel rejected a Restaurant Association of Metropolitan Washington (RAMW) lawsuit that argued the D.C. Board of Elections had erred in counting the number of signatures gathered by proponents of Initiative 82. The ruling means that the measure will appear on the Nov. ballot. If approved by voters, the initiative would slowly phase out tipping by 2027. The current cash wage for tipped employees is $5.05/hr and the city’s minimum wage is $16.10/hr. The industry has launched a coalition, VoteNo82.com, to fight the measure. More details.
Labor Policy
California – The Fast Food Standards & Accountability Act (the FAST Act), or AB-257, was advanced by the legislature and is on its way to the governor’s desk. The bill would establish a panel with members appointed by the governor and legislative leaders composed of workers, union representatives, employers, and business advocates. Among many powers related to setting workplace standards, the panel will be able to set hourly wages of up to $22/hr for fast food workers starting next year and can increase them annually by the same rate as the consumer-price index (up to a maximum of 3.5 percent). The industry was able to add amendments to the bill related to joint employer liability as well as a sunset provision (6 years). The bill covers fast food restaurants that are: part of a chain; that have limited or no table service, and; where customers order their food and pay before eating. The chain must have 100 or more locations nationally, up from 30 in a previous bill version. In both the assembly and the senate, all of the “yes” votes came from Democrats, and every Republican who voted opposed the bill. It is unclear whether the governor will sign or veto the bill. More details.
California – Legislation is on its way to the governor’s desk mandating employers be required to comply with a host of new pay data disclosure requirements. Employers with more than 15 employees would be required to include a pay scale in all job postings (and to provide that information to third parties who post those jobs). Within each job category, the legislation requires that employers report the median and mean hourly rate by each combination of race, ethnicity, and sex. By comparison, existing law requires only numerical counts of employees by race, ethnicity, and sex within each job category and pay band. Employers with multiple establishments would no longer be required to submit a consolidated report; rather, employers would continue to be required to submit a report for each establishment. The governor is expected to sign the bill. More details.
Starbucks – The conservative National Center for Public Policy Research filed a lawsuit against current and former executives and board members (including CEO Howard Schultz) objecting to Starbucks’ setting of hiring goals for Blacks and other people of color. The plaintiff, a Starbucks shareholder, said those policies require the company to make race-based decisions that benefit minorities, and as a result, violate federal and state civil rights laws. In Oct. 2020, the company announced it would aim for minorities, indigenous people and other people of color to hold at least 30 percent of U.S. corporate jobs and 40 percent of U.S. retail and manufacturing jobs by 2025, and tie executive pay to its diversity efforts. More details.
Labor Activism
Amazon – More than 30 groups, including Amazon worker coalitions, labor organizations and community groups sent a letter to Congressional leaders urging them to convene a hearing on warehouse safety and summon Amazon CEO Andy Jassy and other company executives to testify. The letter was sent to Senate Majority Leader Chuck Schumer, House Speaker Nancy Pelosi, and the heads of two congressional committees (Patty Murray and Richard Burr of the Senate’s Health, Labor and Pensions committee, and Bobby Scott and Virginia Foxx of the House Committee on Education and Labor). Organizations that signed the letter include Athena, a coalition of groups that fight for the rights of Amazon workers; the Alphabet Workers Union, which represents employees and contractors at Google and its parent company, and; the Open Markets Institute, a Washington, DC-based nonprofit focused on antimonopoly policy. More details.
Amazon – A hearing officer with the National Labor Relations Board (NLRB) said they intend to throw out Amazon’s objections to a unionization election at a distribution center on Staten Island, clearing a path for the union to become the first certified bargaining unit within the company. The decision has to be further approved by a director but that is likely pro forma. Both sides have until Sept. 16 to file additional exceptions. New organizing campaigns have sprung up in Kentucky, California and North Carolina, and Amazon workers at a warehouse near Albany, N.Y., are slated to vote on unionization in the coming months. More details.
Gallup Poll – A new poll was released this week indicating that 71 percent of Americans now approve of labor unions. Although statistically similar to last year’s 68 percent, it is up from 64 percent before the pandemic and is the highest Gallup has recorded on this measure since 1965. Support for labor unions was highest in the 1950s, when three in four Americans said they approved. Support only dipped below the 50 percent mark once, in 2009, but has improved in the 13 years since and now sits at a level last seen nearly 60 years ago. Additionally, a majority of nonunion workers in the U.S. (58 percent) say they are “not interested at all” in joining a union. About one in 10 say they are “extremely interested” (11 percent). More details.
Alcohol Delivery
New Jersey – The state Division of Alcoholic Beverage Control (ABC) adopted a special rule to allow bars, restaurants, and liquor stores in New Jersey to use third-party delivery services for home delivery. Previously, the governor signed a bill allowing restaurants and bars to directly deliver alcohol to consumers during the pandemic state of emergency, but that law did not allow firms to use third-party delivery services for that purpose. The new rule creates the Third-Party Delivery Permit and applicants must submit a formal agreement with a retail licensee and an agreement with the delivery worker. The delivery worker must undergo both a background check that includes criminal history and a driving record. The driver is also responsible for ensuring that the person receiving the alcohol is 21 years old. The driver is also supposed to refuse a customer who is underage or visibly intoxicated. And establishments will not be allowed to deliver alcohol to college campuses. Permits will cost $2,000. More details.
Key Takeaways
- Within minutes of the SEIU’s landmark victory in California, the union and its allies were announcing plans to export the legislation to additional states including Washington, Oregon, Illinois, and New York among others. In addition to the existing blue trifecta states, operators should be mindful of states (as well as the municipalities within them) that may become blue trifecta after Nov. The SEIU is sure to run a coordinated, centralized effort across multiple states and municipalities, and the industry has to conduct a similar campaign to adequately protect its interests.
- According to job search platform Indeed, more job searchers are looking for work that pays $20/hr, surpassing searches for $15/hr according to data released this week. The combination of labor shortages, worker leverage and the threat of unionization is taking its toll on not only business models but the industry’s ability to stem the associated legislative and political momentum of the wage issue.