California’s recently implemented minimum wage law for fast food establishments has sparked controversy and raised questions about which establishments are exempt from the law. One particular establishment, Panera Bread, has come under scrutiny due to its billionaire franchisee Greg Flynn’s campaign donations to California Governor Gavin Newsom. With 188 Panera Bread locations in California, the question of whether they qualify for an exemption has become a point of contention.
Assembly Bill 1228, authored by Assemblyman Chris Holden and signed into law last year, sets a minimum wage of at least $20 per hour for employees of national fast-food chains operating in the state. The bill defines these operations as restaurants that offer limited table service and consist of more than 60 locations across the country with standardized options for decor, marketing, packaging, products, and services. However, an amendment passed shortly before the bill passed the Legislature makes exceptions for certain establishments.
The amendment states that “fast food restaurant shall not include an establishment that on September 15, 2023, operates a bakery that produces for sale on the establishment’s premises bread… so long as it continues to operate such a bakery.” This exemption applies only if the bread is sold as a stand-alone menu item and not solely as part of another menu item.
Some interpreted this exemption to include Panera Bread, as it sells and bakes bread on-site and offers both bread and meals on its menu. However, Mr. Flynn, the franchisee, denies lobbying for the exemption and states that Panera Bread would be forced to raise wages regardless to remain competitive in the labor market. Critics argue that this potential exemption is a result of a pay-to-play scheme and call it bad legislation.
Governor Newsom’s office denies any involvement in granting an exemption to Panera Bread. They state that Panera Bread is not exempt from the law as their legal team has reviewed and concluded that the restaurant does not meet the criteria for the bakery exemption. The governor’s legal team determined that because Panera Bread does not make bread from scratch but instead has pre-mixed dough delivered, they are disqualified from the exemption.
Further investigation is needed to determine which establishments qualify for exemptions and how the amendment came to be. Lawmaker Assemblyman Joe Patterson calls for an independent look into these allegations to restore Californians’ faith in their government.
The controversy surrounding Panera Bread’s potential exemption from California’s minimum wage law highlights the complexity and grey areas in the legislation. While the law aims to ensure fair wages for fast food workers, questions about exemptions and the role of campaign donations in shaping legislation raise concerns. Californians await further investigation and clarification to determine which establishments are truly exempt and ensure transparency in their government’s decision-making processes.
