Today's News & Commentary –– August 24, 2015
Next month, on Sept. 9, Chipotle plans to hire 4,000 new employees in a new effort to recruit the increasingly scarce restaurant worker, reports the Wall Street Journal. “The economy has been thawing, more restaurants are opening, and there are fewer job applicants,” says Monty Moran, Chipotle’s co-chief executive. The Chipotle recruitment effort will be a 21st Century hiring campaign, replete with advertising on social-media platforms and Pandora. Potential employees who visit Chipotle’s website will now find videos explaining how potential new recruits can rise from “apprentices,” hourly workers, earning $53,000 a year, to “restaurateurs,” or general managers, earning $133,000 annually.
In the meantime, non-managerial workers are benefiting enormously from the paucity of their kind. Many restaurant chains, like Cheesecake Factory and McDonalds, have raised wages to retain workers, and Starbucks and McDonalds now offer tuition benefits for student-employees. Chipotle’s hiring blast also comes on the heels of a slew of new employee perks: more paid sick days, more paid vacation, and college-tuition reimbursement for all hourly workers.
According to The New York Times, in the wake of rising minimum wages for restaurant workers, some restaurants are instituting no-tipping policies and raising menu prices to keep labor costs down while still paying workers more. Eateries in Seattle, where restaurants pay workers a state-mandated $15 an hour, San Francisco, and even Manhattan have rolled taxes and tip into the cost of menu items. Others have instituted a mandatory 20% service or administrative charge.
One restaurateur, who raised prices and cut tipping, described the change as a solution to the “fundamental inequity” between customer-facing wages and kitchen staff wages. Another, who currently pays workers $25 an hour, described the experimentation as a 21st century necessity, “How else do you compensate for this extra money you’ll have to pay?”
The death of the tip will also simplify bookkeeping, as tipping is subject to federal, state, and local regulations, and perhaps curb racial and sexual bias that leads to black servers earning less and women earning more. But the experimentation will pay off only if customers, paying higher prices, and servers, accustomed to topping culture, accept the new arrangement.
Reuters reports that many Hollywood studios are now preparing to defend against an antitrust lawsuit accusing the conglomerates of illegally colluding not to solicit one another’s animators. The motive? To keep wages down.
Last Thursday, U.S. District Judge Lucy Koh of San Jose, California denied the motion to dismiss filed jointly by Walt Disney, including LucasFilm and Pixar, Sony, Dreamworks, and 21st Century Fox. Koh found that emails between the studios, along with other evidence, indicated that the studios had agreed not to poach animators, shared sensitive employment data, offered “misleading” and “pretextual” justifications for wage depression, and fraudulently concealed their conspiracy. It was enough, according to Koh, to “create a plausible inference that defendants entered into an express agreement to suppress compensation.”
The Washington Post reports that eighty minority workers have asked U.S. Attorney General Loretta E. Lynch to open an investigation into allegations that black American Airlines employees at Reagan National and Philadelphia International airports are racially harassed and assigned more difficult and less desirable tasks because of their race. According to the lawyer behind the complaint, Brian R. Mildenberg, American Airlines has “discriminated against minority employees by subjecting them to harassing and degrading treatment” and “disproportionate discipline and retaliation for raising civil rights complaints.” The Justice Department has yet to respond to the request to investigation, filed over a month ago.