New Laws Set to Impact the Restaurant Industry in 2020
Year after year, new laws go into effect that shake-up businesses around the country. What’s more, it often seems like it’s not long after businesses settle into a new law that more disruptive ones are enacted.
Many of these laws have a huge impact on the restaurant industry, from matters of hiring to the technology used to manage guest relationships. But rather than wait until they’ve had a chance to negatively affect your business in some way, it’s important to prepare for them as soon as you can.
In 2020, these are the new (or updated) pieces of legislation restaurant owners must pay attention to:
1. California Consumer Privacy Act (CCPA)
What is it?
The California Consumer Privacy Act, or CCPA for short, is a recent ruling that allows California residents to take control of their information online.
Businesses that operate in California or otherwise engage with California residents (even if it’s just online), must provide consumers with the ability to:
- Choose which bits of personal information to share with companies.
- Grant access to companies to share their info with other organizations.
- Request information about what’s being done with their data.
- Delete data that’s been captured.
It’s not just customers that this law protects either. Employees are granted the same rights as well.
How will it affect restaurants?
You might not think that a business that consists mainly of person-to-person engagements in a restaurant setting would be subjected to this law. After all, aren’t consumers just worried about their online privacy? Plus, what if you don’t do business in California?
The fact of the matter is, the CCPA changes everything. And it’s just the start of states (and maybe even the federal government) passing sweeping legislation that limits or prohibits what companies can do with consumer data. Even if you don’t serve customers in California, this is something you have to take seriously.
What can you do?
You’ll need to look over every square inch of your business to identify areas where customer or employee information is being handled:
- Point-of-sale systems
- Human resources software
- Payment processors
- Reservation systems
- Mobile apps
- Website visitor tracking
- Newsletter subscriptions
- Rewards programs
- Third-party delivery or takeout services
- On-premise tracking (like geofencing or tableside tablets)
- User reviews and feedback systems
Then, make sure you’re handling their data responsibly (i.e. make sure it’s both private and secure). And don’t forget about providing them with access to their data and control over what you do with it — for both guests and employees.
Want to learn more about the CCPA and how it might affect your business? Stay tuned for a new article coming soon.
2. California Assembly Bill 5
What is it?
For a long time now, the government has attempted to clarify the terms of what makes someone an independent contractor versus an employee. California lawmakers have put out a new piece of legislation that attempts to deal with that sometimes grey area.
Assembly Bill 5 (or AB5) has laid out three criteria that must be satisfied in order to rightly call someone a contractor:
- The worker is not directed by nor controlled by the organization and can work as they see fit.
- The worker provides a service that the organization does not or cannot otherwise handle.
- The worker provides this kind of service to other organizations, either independently or through a business.
If these three criteria cannot be met, the worker attains employee status and is owed all relevant rights.
How will it affect restaurants?
For some restaurants, this law might not have any effect at all. This strictly takes aim at the relationship a business has with independent contractors; not with part-time employees.
In the case of a restaurant, a contractor might be a:
- Delivery driver or service
- Liquor or beer consultant
- Guest chef
- On-site cooking class instructor
- Construction consultant or interior decorator
Basically, if someone is providing you with a specialized service, this is when you need to pay close attention to this law.
What can you do?
Create a list of all your contractor relationships. Then, make sure you are actually treating them like an independent entity. In other words, you do not provide them with tools to do their job, you do not train them or provide guidance on their work, and you have not hired them to do a job you already do internally.
If a line’s been crossed in any way, then you need to amend your working relationship or start paying them as you would an employee.
3. Multi-state Minimum Wage Increases
What is it?
It’s no longer a few random cities or pockets of the country where the minimum wage is inching up closer to a $15 minimum. Many states have recently passed new minimum wage limits for 2020.
How will it affect restaurants?
The Economic Policy Institute collected this data on states that have made recent changes to the minimum wage:
States in green passed new laws in late 2019 and early 2020. States in purple passed ballot measures related to the minimum wage. And states in blue made adjustments for inflation.
You can find more data on the local minimum wage and subminimum wage for tipped employees here.
What can you do?
If you operate in any of the states that have recently enacted legislation to raise the minimum wage, and you haven’t made adjustments internally yet, take care of it as soon as possible.
And if you’re in one of the states that’s lagging behind, it might be a good idea to start slowly increasing your employees’ wages over the coming year. You never know when your state or city will be the next to implement a higher minimum wage and it’s better to be prepared than to have to scramble to figure out a solution on the spot.
4. Americans with Disabilities Act: Robles vs. Domino’s
What is it?
In the case of Guillermo Robles vs. Domino’s Pizza, Robles, a blind man, asserted that Domino’s website was in violation of the Americans with Disabilities Act or ADA.
This was the ruling:
“The panel held that the ADA applied to Domino’s website and app because the Act mandates that places of public accommodation, like Domino’s, provide auxiliary aids and services to make visual materials available to individuals who are blind. Even though customers primarily accessed the website and app away from Domino’s physical restaurants, the panel stated that the ADA applies to the services of a public accommodation, not services in a place of public accommodation. The panel stated that the website and app connected customers to the goods and services of Domino’s physical restaurants.”
Because Domino’s had been given advance notice that its website needed to be accessible and, yet, made no accommodations thus, the court ruled in favor of Robles. When Domino’s tried to appeal the ruling, the Supreme Court shut down the request.
How will it affect restaurants?
This isn’t the first time a website for a physical business has come under fire for its lack of accessibility. Grocery store Winn-Dixie was the first to be charged in a federal case with having an inaccessible website in 2017.
With this ruling against a major restaurant chain like Domino’s, this is a big deal for the restaurant industry as a whole. Restaurants that may or may not have been aware of the Winn-Dixie case, won’t be able to ignore the ADA any longer.
What can you do?
First, it’s important to understand what Title III of the ADA says about “public accommodation”:
“Title III prohibits discrimination on the basis of disability in the activities of places of public accommodations (businesses that are generally open to the public and that fall into one of 12 categories listed in the ADA, such as restaurants, movie theaters, schools, daycare facilities, recreation facilities, and doctors’ offices) and requires newly constructed or altered places of public accommodation — as well as commercial facilities (privately owned, nonresidential facilities such as factories, warehouses, or office buildings) — to comply with the ADA Standards.”
The reason why companies like Winn-Dixie and Domino’s have fought against their rulings is because the original law never stipulated that websites were considered public accommodations. However, as the Domino’s case has demonstrated, it doesn’t matter if you are serving someone person-to-person in your restaurant or you’re “serving” them through your website.
Your site visitors need to have the ability to:
- Navigate around your site with their keyboard only.
- Hear your menu read by a voice assistant.
- Fill out a reservation form with ease (e.g. with clear labels, HTML markup for fields, tabbing enabled, etc.)
In other words, impaired visitors must be able to engage with it as a non-impaired user would.
While your website might be the last thing you want to spend time and money on revamping, it’s not something you can afford to put off any longer. It needs to be welcoming and accommodating to all users regardless of impairment.
How Will New Laws Impact Your Restaurant?
While some of these laws have been enacted at a state level, that doesn’t mean you can ignore them.
It’s important to keep an eye on states like California that have a tendency to set the bar in terms of legislation (like when it raised the minimum wage to $15). Because if they’re making big enough waves where businesses around the country are talking about it, it’s only a matter of time before the laws arrive at your front door.
