Fast food chains may lose the right to do business in New York City, under new labor protection bill

Kyle Bragg, president of 32BJ, which has been working to regulate Chipotle workers across the city, voiced the proposed legislation.

“Often, large companies like Chipotle have viewed fines and incidental lawsuits for their repeated violations of New York City employment laws, such as the Fair Workweek, as little more than the ‘cost of doing business,’” Bragg said. The bad guys in the fast food industry have an obvious choice: stop violating the laws of our city or risk losing your right to run your business in New York.”

The new bill would also increase penalties for violations of the law – to $1,500 – from the current level of $750. The penalties for repeated violations will also be doubled to $2,000. If a company’s food license is revoked under the bill, workers are also entitled to 14 days of dismissal.

At the council’s hearing on Monday, Elizabeth Wagner, a representative of the Consumer and Worker Protection Department — which is overseen by the mayor’s office — testified against lifting sanctions on employers.

“We feel that the current civil penalty amounts are truly appropriate and effective tools,” she said. “Increasing the amounts of civil fines owed to the city will not align with our enforcement priorities, which are to ensure workers receive cash relief.”

Wagner won’t say definitively whether the administration supports expanding the agency’s authority to revoke licenses for potential repeat abuses.

“We look forward to working with the council on ideas to enhance deterrence or non-compliance and to the extent possible repeal could achieve that goal, and we are happy to explore that further,” she said. “We think it’s a very interesting idea.”

New York City’s Fair Work Week Act went into effect in November 2017. Since then, the city has filed more than 440 complaints of abuse, and closed more than 220 investigations, according to the Consumer and Workers Protection Department.

Some provisions of the law are rarely enforced. It was intended to provide “good cause” protection for fast food workers, which would prevent employers from firing employees indiscriminately.

When the city sued Starbucks to fire an Astoria-based union regulator earlier this month, it acknowledged it was the first time it had taken action under this provision of the law.

In May, dozens of Chipotle workers who went on a week-long strike said they continued to stick to unpredictable schedules and intermittent work hours.

Enforcement is “a huge challenge for these kinds of laws,” said Ruth Milkman, a professor at the New York School of Labor and Civil Studies. Another issue, she added, is making sure workers are aware of the rules. She said those penalties appeared to be “fairly modest.”

If the bill passes through the council, it is not clear if it will cover the previous fines.

Chipotle did not immediately respond to a request for comment.

Kathryn Wilde, president and CEO of the New York City Partnership, which advocates for business interests, is concerned that the bill could hamper the city’s economic recovery.

“This is an effect on franchisees who are mostly small businessmen and many minorities,” she said. “It seems that imposing more fines and requirements on them goes in the opposite direction of the supposed desire to help the recovery. It’s not the big companies that get stuck in these fines.”

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