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Trade Groups Unhappy With New York Wage Board Decision

Last updated on June 13th, 2024 at 05:22 pm

The wage board appointed by New York Gov. Andrew Cuomo to set a new minimum wage for the state’s fast food restaurants voted July 22 to recommend a $15 minimum wage for quick-service chains that have at least 30 locations nationally.

The wage board’s recommendations kick off a 15-day comment period, after which the report goes to Acting Labor Commissioner Mario Musolino. He has 45 days to sign an order putting the increase into effect.

The Save New York Restaurants Coalition, led by the New York State Restaurant Association (NYSRA), National Restaurant Association (NRA) and other groups, has issued a statement opposing the recommendation. The coalition is evaluating its options for challenging the decision.

“We are deeply disappointed in today’s decision by Gov. Cuomo’s self-appointed wage board,” the coalition said in the statement. “The members of this board not only refused to sit at the table but closed the door for discussion. The entire process has been a sham and the cards have been stacked against the hard-working men and women that own and operate New York’s restaurants from day one.”

While the NYSRA and NRA made the case about the discriminatory targeting of one group of employers and the potential loss of jobs and opportunity that could come as a result of an unreasonable wage hike, restaurant operators’ concerns were largely dismissed by the wage board. More than 100 operators asked Cuomo for a meeting to voice their concerns. No response was received and no meeting was held.

“From day one Gov. Cuomo’s wage board has sought to silence the business community and force through an unfair and discriminatory increase on a single sector of one industry,” said Melissa Fleischut, president and CEO of the NYSRA. “From stacking the board with supporters of an increase to allowing business owners to get booed and heckled at public hearings the governor has rigged the game at every turn. Since the governor used a process that rejects compromise the result is an extremist policy that will force business owners in this low-profit-margin industry to cut hours, lay off employees and use technology to help offset skyrocketing labor costs.”

The three-member board, which Cuomo appointed, did not include any restaurant operators. It included Buffalo Mayor Byron Brown, Service Employees International Union (SEIU) Secretary-Treasurer Mike Fishman and Kevin Ryan, chairman and founder of online retailer Gilt. The SEIU reportedly has spent millions of dollars supporting a $15 minimum wage across the country.

The wage board will recommend to the New York State Department of Labor, which will be responsible for implementing the new wage, that the wage be phased in by 2018 for quick-service restaurant employees in New York City and by 2021 for QSR employees in the rest of the state. The first increase, from $8.75 to $10.50 for New York City QSR employees and $8.75 to $9.75 for other parts of the state, would take effect Dec. 31, 2015. The statewide QSR minimum wage would then be increased by $1 on Dec. 31 of each year before rising to $14.50 on Dec. 31, 2020, and, finally, $15 on July 1, 2021. In New York City, the QSR minimum wage would increase from $10.50 to $12 on Dec. 31, 2016, and $13.50 on Dec. 31, 2017, before reaching $15 on Dec. 31, 2018.

“Today’s decision will hurt the very people Gov. Cuomo is purportedly trying to help,” according to a statement issued by Save New York Restaurants Coalition. “Restaurants will be forced to streamline labor costs through automation and attrition or close their doors completely. Gov. Cuomo has sent his message loud and clear: New York is not open for business.”

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The Shelby Report delivers complete grocery news and supermarket insights nationwide through the distribution of five monthly regional print and digital editions. Serving the retail food trade since 1967, The Shelby Report is “Region Wise. Nationwide.”

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