Fair Workweek Law: An Overview

Fair Workweek Law: An Overview
AJ Beltis

By AJ Beltis

Table of Contents

    Cities and states across the US are responding to a movement known as “fair workweek,” with many enacting new laws to shield restaurant employees’ personal lives and finances from the notoriously unpredictable world of restaurant scheduling.

    Even though fair workweek has already been established law in cities like New York and states like Oregon, many restaurants affected by these laws don’t know the full extent of them (or are ignoring them altogether). However, failing to adhere to these new rules when you’re subject to them can result in fines totalling millions of dollars.

    In this article, we’ll be giving an overview of what fair workweek is, where it applies, and the consequences restaurants could face for violations of fair workweek laws.

    We’ve also written a new ebook with even more details on fair workweek and labor compliance, including facts, strategies, and checklists for you to reference when scheduling employees to ensure you’re staying compliant. You can download The Complete Labor Compliance Playbook for Restaurants for this additional information that could help save your restaurant thousands—or even millions—in labor compliance fees.

    What is “Fair Workweek?”

    Fair Workweek refers to the movement to give employees more rights when it comes to their work schedules. Fair workweek laws largely revolve around their idea of “predictive scheduling”—the right of employees to know how many hours they will work and when their shifts will be. All fair workweek laws dictate schedules must be shared 7-14 days in advance, depending on the location, and require that restaurants provide “premium pay” to employees whose schedules are altered after that timing threshold passes.

    The arguments for fair workweek and predictive scheduling laws focus on employees deserving the right to dependable hours, schedules, and pay for better quality of work and life. Federal law does guarantee a few crucial worker rights, such as a base minimum wage of $7.25, overtime eligibility after 40 hours worked, and restrictions on child labor. No matter where your restaurant is located, how many locations the group has, or how many employees work for the business, all businesses must follow these restaurant labor compliance standards.

    However, fair workweek laws provide even more rights to employees at qualifying restaurants in certain parts of the country.

    For decades, restaurant employees—particularly those working for franchises or chains with multiple locations, many employees, and high turnover rates—have exhausted themselves with workweeks exceeding 40 hours, working back-to-back closing and opening (or “clopen”) shifts, and rarely having time for a break. On top of that, owners and managers are sometimes forced to make last-minute shift changes, frustrating on-call employees and those who thought they had the day off when they’re told to come in for a mandatory shift.

    Fair workweek seeks to minimize these stressful situations by:

    • Mandating that employers share schedules with their employees 1-2 weeks in advance
    • Allowing employees to give input on scheduling needs
    • Requiring employers to offer existing employees the opportunity to take on a new shift before hiring a new employee to fill it
    • Restricting the right of employers to schedule employees for "clopens"
    • Requiring employers pay a premium to employees for when changes to their schedules are made

    While this can seem to be a burden for the employers of these newly-liberated workers, the benefits can spill over to the restaurant in the form of a happier, more productive, and better performing staff. One pilot program that tested fair workweek policies saw a 5% increase in labor productivity and a 7% increase in median sales, so there is clear potential for a win-win scenario.

    It’s worth noting that all existing fair workweek laws apply only to larger restaurant groups and chains in only a few areas of the country, so if you’re a one-location pizzeria in South Dakota that employs eight people, none of these laws apply to you right now (though they may in the near future if the fair workweek trend continues—so either way, read on!).

    What is “Fair Workweek Legislation”?

    Fair workweek legislation refers to the laws that currently exist, will exist, or may exist regarding fair workweek laws.

    Currently, there are four major cities and one state with fair workweek laws, in addition to two more cities that are slated to see fair workweek legislation take effect in 2020.

    If you see your city or state below, take a moment to read through the laws that exist in your area and which restaurants they apply to. Again, note that most of these laws apply to larger restaurant groups or franchises, rather than single-location restaurants or small, local chains.

    We outline what each of the laws listed below for each state in The Complete Labor Compliance Playbook for Restaurants—download it now for the most applicable information for your business.

    US States

    Oregon

    Law: Oregon Fair Work Week Act

    Applies to: Restaurants in Oregon with 500+ employees worldwide.

    Qualifying Oregon restaurants must provide hourly employees with the following:

    • Fees for schedule changes
    • “Good Faith” scheduling estimates for new hires
    • Employee input on schedules
    • Predictive scheduling
    • Restrictions on "clopens"

    US Cities

    City: Emeryville, CA

    Law: Emeryville Fair Workweek Ordinance

    Applies to: Restaurants with 56+ employees globally (and 20+ employees in Emeryville).

    Qualifying Emeryville restaurants must provide hourly employees with the following:

    • Fees for schedule changes
    • “Good Faith” estimates
    • Predictive scheduling
    • Restrictions on "clopens"

    City: New York City, NY

    Law: New York City Fair Workweek Law

    Applies to: “Fast Food” restaurants: Foodservice businesses that are part of a chain and are one of 30+ establishments nationwide.

    Qualifying New York City restaurants must provide hourly employees with the following:

    • Fees for schedule changes
    • “Good Faith” scheduling estimates for new hires
    • Predictive scheduling
    • Preferential scheduling
    • Restrictions on "clopens"

    City: Seattle, WA

    Law: Seattle Secure Scheduling Ordinance

    Applies to: Restaurants with 500+ staff members worldwide.

    Qualifying Seattle restaurants must provide hourly employees with the following:

    • Input on schedules
    • Fees for schedule changes
    • “Good Faith” scheduling estimates for new hires
    • Predictive scheduling
    • Preferential scheduling
    • Restrictions on "clopens"

    City: San Francisco, CA

    Law: Predictable Scheduling and Fair Treatment for Formula Retail Employees Ordinance

    Applies to: Restaurants with 20+ locations worldwide and those that employ 20+ people in San Francisco.

    Qualifying Seattle restaurants must provide hourly employees with the following:

    • “Good Faith” scheduling estimates for new hires
    • Predictive scheduling
    • Fees for schedule changes

    Upcoming US Cities

    While the cities and state listed above have laws that are already in place, two additional cities have laws that will go into effect in 2020.

    City: Chicago, IL

    Law: Chicago Fair Workweek Ordinance

    Effective: July 1, 2020

    Applies to: Restaurants with 30+ locations that globally employ 250+ people.

    Qualifying Chicago restaurants will have to provide hourly employees with the following:

    • Fees for schedule changes
    • Predictive scheduling
    • Restrictions on "clopens"

    City: Philadelphia, PA

    Law: Philadelphia Fair Workweek Employment Standards

    Effective: January 1, 2020

    Applies to: Restaurants with at least 250 employees and 30+ locations worldwide.

    Qualifying Philadelphia restaurants will have to provide hourly employees with the following:

    • “Good Faith” scheduling estimates for new hires
    • Predictive scheduling
    • Fees for schedule changes
    • Restrictions on "clopens"

    What’s Next?

    With multiple pieces of fair workweek legislation in place and more on the way, it’s fair to assume that fair workweek regulations will be impacting labor discussions on a state, city, and federal level in the years to come. For example, other states like Massachusetts and New Hampshire have taken small steps towards fair workweek legislation, while workers in cities like Los Angeles are also coming together for a similar purpose.

    Either way, if your city or state wasn’t listed above, don’t discount the idea that fair workweek laws could be coming to your restaurant someday soon.

    The Cost of Compliance Laws: Fines for Violating Fair Workweek Regulations

    To discourage restaurants from ignoring or breaking the laws set forth by fair workweek, these ordinances come with hefty fines for infractions—fines that apply each time an individual law is violated.

    Although these fines range from $200 to $2,500 on a per-incident level, restaurants that violate these laws multiple times may be faced with lawsuits in the millions due to repeat offences and backpay requirements to affected employees.

    In fact, by 2020, US restaurants will pay $30 million in compliance fees. As these laws become commonplace in more and more cities, the learning curve for fair workweek will be forcibly sped up when an increasing number of restaurants are hit with lawsuits and high fines.

    We’re already seeing this idea come to fruition. In September, Chipotle was served a lawsuit for allegedly violating every aspect of New York City’s Fair Workweek Law multiple times. If found guilty, the chain could face more than $1 million in fines. We can expect to see even more of these large groups be made examples of when they blatantly refuse to obey fair workweek laws, which should work as the ideal deterrent for other restaurants on the fence about how legitimate this movement is.

    For a more in-depth outline of how much a fair workweek law infraction can cost a restaurant business in each area, download The Complete Labor Compliance Playbook for Restaurants here.

    How Will Fair Workweek Legislation Affect My Restaurant Scheduling?

    For qualifying restaurants, fair workweek means making significant changes to how you hire employees, how you manage them, and, of course, how you schedule them.

    Here are three concrete ways your scheduling processes will be different in a fair workweek world.

    1. You’ll Need to Plan Schedules Farther in Advance

    The laws are in place to mandate your schedules go out two weeks in advance—and high fines await restaurants that violate this rule. This means you’ll need to be more proactive in sourcing scheduling adjustments and time off requests from your employees early to avoid those fines.

    As schedule changes within the threshold come in—and we all know they will—managers will need to seek ways to lower their premium pay by asking employees to voluntarily trade shifts ahead of the scheduled workday. In cities like New York, this negates the need to provide premium pay.

    2. You’ll Need to Monitor and Document Costs, Violations, and Consent

    To avoid paying fines on top of premium pay, you’ll need to document (a) each time a scheduling shift happens, (b) how much you paid out to parties owed applicable premium pay, and (c) any required consent for taking a shift that requires it.

    This new issue of costs will also be at the forefront of your scheduling process like never before. You’ll now have to consider the monetary cost of putting an employee on a "clopen" shift, for example.

    3. Your Restaurant Will Benefit from Technology

    Setting a schedule is hard enough without all of these rules and threats of fines. To save time making constant revisions to your schedule—and to save money by limiting your infractions—use an employee scheduling software that’s equipped to meet the labor compliance needs of fair workweek laws.

    What You Need to Know for Your Restaurant

    Here are a few best practices to keep in mind as you navigate the world of fair workweek.

    • Be aware of your state/city laws. Even if you don’t have fair workweek laws to adhere to now, that might not be the case a year or two from now. Subscribe to industry publications and keep the line of communication with your local restaurant association open so you’re aware of what’s coming next.
    • Keep managers informed. The managers who make the schedule should be well informed as to what laws they need to follow. Ensure they’re fully trained on building a schedule that obeys the law and minimizes your fine and premium pay amounts.
    • Make staff aware of their rights. Some states/cities require you to conspicuously post workers’ fair workweek rights in the restaurant. Regardless of the posting, be open and transparent with employees about what rights they have and how your failure to adhere to them could hurt the business financially. This openness empowers employees to be responsible while also helping you stay compliant.
    • Understand your worldwide presence. Remember that fair workweek laws apply to restaurants based on their international or domestic presence, not just the city or state itself. For example, if your restaurant chain has 28 locations—with spots in NYC and San Francisco—you will need to follow San Francisco’s law, but not New York City’s. Knowing where you lie in the larger landscape will help you know which fair workweek laws apply to you and which don’t.
    • Communicate with corporate. Your corporate office or franchise manager does not want to see the restaurant’s name making headlines for labor law violations. Chances are, they have training, documentation, or resources available to help you adhere to laws. Take advantage of those tools to stay compliant.
    • Technology is your friend. One tool that will help your restaurant thrive is technology. For example, 7shifts employee scheduling software sends you alerts when an employee is set to work a "clopen" so you can adjust accordingly, and sends out schedules electronically to employees in the required time frame. You can try it yourself with a free two-week trial.

    Bottom Line: Fair Workweek is Just Beginning

    As fair workweek legislation makes its way into more restaurants across the country, it’s imperative for your restaurant to start incorporating these changes. Even if your restaurant isn’t required to adhere to these practices now, slowly rolling them into your scheduling process will make them commonplace if a time comes where they’re not an option.

    Also, keep in mind that fair workweek restrictions, while at times frustrating, exist to better your employees’ livelihoods and work-life balance. Try to see it as an opportunity to boost employee retention and satisfaction rather than an inconvenience, and you might be surprised at the net benefits that make their way into your restaurant.

    Still overwhelmed by the prospect of fair workweek? We totally get it. Whether you’re an owner, manager, franchisor, or corporate employee, fair workweek legislation is a big deal. That’s why we’ve laid out the laws, fines, myths, and suggested processes of fair workweek in our ebook, The Complete Labor Compliance Playbook for Restaurants. We’ve also included three checklists for you to put fair workweek practices into place with clear instructions and steps. Download the ebook now and get compliant today.

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    AJ Beltis
    AJ Beltis

    AJ Beltis is a freelance writer with almost a decade of experience in the restaurant industry. He currently works as a content specialist at HubSpot, and previously as a blogger at Toast.