Is Panera Bread’s CA minimum wage exemption a Newsom favor?

[KARAH RUCKER]

AN EXEMPTION TO CALIFORNIA’S FAST FOOD MINIMUM WAGE LAW HASN’T BEEN GETTING A LOT OF ATTENTION — UNTIL NOW.

IN APRIL – FAST FOOD CHAINS IN CALIFORNIA WILL HAVE TO PAY THEIR EMPLOYEES AT LEAST $20 AN HOUR.

BUT THAT MINIMUM WAGE REQUIREMENT –

WON’T APPLY TO PANERA BREAD.

THERE’S A LOT OF SPECULATION AS TO WHY THAT IS.

AND IT INVOLVES SOMEONE WHO OWNS A NUMBER OF THE FRANCHISES AND HIS TIES TO THE STATE GOVERNOR – GAVIN NEWSOM.

THE NEW MINIMUM WAGE LAW REQUIRES FAST FOOD RESTAURANTS THAT HAVE AT LEAST 60 LOCATIONS – TO START PAYING THEIR WORKERS A MINIMUM OF $20 AN HOUR.

THE EXCEPTION?

IF A FAST FOOD CHAIN BAKES AND SELLS BREAD AS A STANDALONE ITEM –

YOU DON’T HAVE TO INCREASE THE AMOUNT OF MONEY YOU PAY YOUR EMPLOYEES.

YOU CAN START YOUR MINIMUM WAGE AT $16 AN HOUR.

THERE’S NOT A LOT OF FAST FOOD COMPANIES THAT BAKE AND SELL BREAD BY ITSELF.

BUT PANERA BREAD –

DOES.

AS BLOOMBERG FIRST REPORTED –

BILLIONAIRE GREG FLYNN’S FLYNN RESTAURANT GROUP OWNS MORE THAN A HUNDRED PANERA BREAD FRANCHISES, INCLUDING A COUPLE DOZEN IN CALIFORNIA..

FLYNN  HAPPENS TO HAVE CLOSE TIES WITH CALIFORNIA GOVERNOR GAVIN NEWSOM –

ACCORDING TO SOURCES WHO SPOKE WITH BLOOMBERG.

FLYNN IS A LONGTIME FRIEND AND **DONOR TO THE GOVERNOR ACCORDING TO BLOOMBERG’S REPORT.

THE TWO WENT TO HIGH SCHOOL TOGETHER.

AND FLYNN HAS DONATED TO NEWSOM’S CAMPAIGNS –

INCLUDING A 100 THOUSAND AND 64 THOUSAND DOLLAR DONATION IN 2022.

SOURCES TOLD BLOOMBERG FLYNN IS KNOWN TO BRAG ABOUT HIS CLOSE RELATIONSHIP WITH NEWSOM.

IN A PRESS CONFERENCE LAST YEAR –

A REPORTER QUESTIONED NEWSOM ABOUT ANY ULTERIOR MOTIVE BEHIND THE PECULIAR EXEMPTION –

THAT FAVORS PANERA – 

OVER DOZENS OF OTHER FAST FOOD CHAINS.

BUT THE GOVERNOR CHALKED IT UP TO JUST HOW NEGOTIATIONS GO.

[NEWSOM]

“Why did you agree these workers should not be part of this?

Its the nature of negotiation.”

[KARAH RUCKER]

HOWEVER.

PEOPLE FAMILIAR WITH THE BEHIND-THE-SCENES OF THOSE NEGOTIATION TALKS –

SAY IT WAS NEWSOM PUSHING FOR PANERA TO BE EXEMPT.

THIS “BAKERY CLAUSE” WAS ADOPTED “AS A MEANS OF GAINING THE GOVERNOR’S SUPPORT FOR THE LEGISLATION” – ACCORDING TO BLOOMBERG’S SOURCES.

OTHER FAST FOOD CHAINS.

WERE NOT HAPPY.

MCDONALD’S SAYS THE MINIMUM WAGE HIKE WILL COST EACH CALIFORNIA LOCATION 250 THOUSAND DOLLARS A YEAR –

CALLING IT A “DEVASTATING FINANCIAL BLOW.”

CHIPOTLE – SAYS IT WILL COST THE COMPANY AN EXTRA 74 MILLION DOLLARS –

AND WILL RAISE MENU PRICES IN THE “HIGH SINGLE DIGITS TO PRESERVE MARGINS.”

EL POLLO LOCO IS ROLLING OUT **KIOSKS TO TRIM THEIR WORKFORCE.

AND WILL ALSO INCREASE FOOD PRICES.

IF YOU’RE THINKING WHY DON’T THESE RESTAURANTS JUST START SELLING A PIECE OF BREAD SO THEY ALSO CAN QUALIFY FOR THE EXEMPTION?

THEY CAN’T.

SELLING STANDALONE BREAD HAD TO BE ON THE MENU BY SEPTEMBER 15 OF LAST YEAR TO QUALIFY.

AND SELLING ITEMS LIKE BAGELS OR CROISSANTS –

ALSO DOESN’T COUNT.

MICHELLE KORSMO – THE HEAD OF THE NATIONAL RESTAURANT ASSOCIATION –

SAID EVERYONE IS SCRATCHING THEIR HEAD OVER THE BREAD EXEMPTION.

AND DESCRIBED THE PROVISION AS AN EXAMPLE OF WHY HER ORGANIZATION’S MEMBERS SHOULD DEVELOP POLITICAL CONNECTIONS –

“TO SEEK BETTER LEGISLATIVE OUTCOMES.”