By Jeanne Kuang | CalMatters
Let’s say you work at a fast food restaurant or coffee shop that is named after a national chain. Under California law, you are entitled to be paid at least $20 an hour starting Monday.
Let’s say you work in one of these stores, in a grocery store. The grocery store, your employer, is exempt by law. You will continue to receive your current salary.
But let’s say you make burgers, make ice cream, or make frappuccinos at one of these stores, and it’s in another store, but the larger store isn’t a “grocery store” because fewer half of his income comes from groceries. So what ?
According to the state of California, the store should pay you at least $20 an hour, but only for the hours you work in the fast food portion of the store. If you spend part of your shift checking on customers or stocking shelves in the rest of the store, you are only entitled to the regular minimum wage of $16 for those hours.
That’s according to an 18-point FAQ released by the Department of Industrial Relations in March, as California businesses prepare for the fast-food minimum wage to take effect Monday.
This is not the only situation causing confusion among employers and workers.
To raise wages for fast food workers, the Service Employees International Union reached an agreement last year with the International Franchise Association and the California Restaurant Association that included owners of fast food chains but exempted those who operated independent restaurants.
The law covers all fast food restaurants owned by chains with 60 or more locations nationwide, focusing on union targets: McDonald’s or Burger King and their franchise owners. More than 500,000 Californians — mostly women, immigrants and people of color — work in what the industry calls “limited-service restaurants.” Earlier this year, the SEIU estimated that the law would apply to about 3,000 employers.
“The vast majority of fast food restaurants in California operate under the most profitable brands in the world,” Joseph Bryant, SEIU executive vice president and member of a new fast food regulatory board, said today in statewide. “These companies must pay their fair share and provide their operators with the resources they need to pay their workers a living wage without eliminating jobs or passing the cost on to consumers. »
But aside from these national chains, there are many other food sellers and trade agreements, not all of which are directly addressed in the new law. Grocery stores and some bakeries are exempt, and this week, Gov. Gavin Newsom signed a law excluding fast food establishments at airports, convention centers and hotels.
According to emails obtained by CalMatters in response to a public records request, several employers have been trying to figure out whether to pay $20 since the law was signed late last September.
In October, the Department of Industrial Relations received two requests from franchisees asking whether they needed to comply with the law. One employer owned an Auntie Anne’s and a Cinnabon and believed that selling pretzels and cinnamon rolls made them eligible for the controversial bakery exemption. The other had an ice cream parlor.
“This clarification is imperative as to whether or not we will be financially able to open more locations with the proposed $20 per hour wage increase,” the ice cream shop owner wrote.
Both were referred to the department with a request for legal advice by Assembly staffer Chris Holden, the law’s author. In recent weeks, Holden has been unable to answer questions from reporters about why certain exemptions – such as an exclusion for certain bakeries – were included in the law. The department redacted responses to these emails under a public records exemption for attorney-client communications.
Ice cream shop owner Gabriela Campbell was profiled this week in a KCRA report detailing how she contacted several state offices and still doesn’t know if the law applies to her.
In December, employers took legal action.
Lawyers for the Honey Baked Ham chain questioned whether she would qualify. They described the stores as “retail meat shops” where customers primarily buy cooked ham and other “bulk proteins” and sides to eat at home, but acknowledged they also sell sandwiches which customers can eat in the restaurant or take away.
The attorneys also asked for clarification on whether their clients should pay $20 if they own a chain of Papa Murphy’s “take-and-bake” pizzerias.
In late December, lawyers for an unnamed retail chain asked the department whether they should pay $20 at fast-food restaurants or cafes inside some of its stores. The attorneys noted that the company’s stores sometimes sell groceries, but not primarily, and that employees who work the fast-food counters are often assigned to other parts of the store as well.
The department’s attorney, Ehud Appel, said he did not respond to individual requests, but instead responded to companies with the FAQ this month.
In the FAQ, the state said: Businesses are not exempt from selling ice cream, even though a state industry classification system excludes certain ice cream parlors from the definition of fast food or “limited service” restaurants. To be considered a bakery, according to the state, the bread sold must weigh at least half a pound. And workers at a “store within a store” must be paid $20 for the hours they work in the restaurant portion of the stores.
The answers apparently created new questions.
The FAQ states that fast food managers can only be exempt from California’s overtime pay laws if they earn more than twice the minimum wage — a threshold that is now higher for fast food employees. But the retailer’s lawyers wrote in another letter to the department in mid-March that store managers only run the fast-food counters on a part-time basis.
It’s unclear how the state will handle the confusion going forward.
Its FAQ directs workers who believe they are being wrongly denied $20 an hour to file a wage theft complaint with the labor commissioner’s office — a process that is so overdue amid a staffing crisis for the office that complaints can take years to resolve. The ministry did not immediately respond today when asked for further clarification.
The new fast food council could also take up the concerns, or it could end up in court to decide.
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