In the ongoing battle between New York City and San Francisco to enact the nation’s costliest labor laws, the Big Apple may have just pulled into the lead.
Yesterday, as reported by The Wall Street Journal, New York City Mayor Bill de Blasio signed a package of laws that increases the cost of employment and makes running a retail or fast food franchise more difficult.
Here is a quick rundown of the new requirements on employers:
- Require predictable schedules: “require fast-food employers to offer workers their work schedule at least 14 days in advance, and pay a premium for last-minute shift changes”
- Prohibit “Clopenings”: “prohibit fast-food employers from scheduling consecutive shifts involving both the closing and opening of the restaurant”
- Restrictions on new hires: “require fast-food companies to offer new work shifts to current employees before making external hires”
- Require dues deductions for union front groups: “allow fast-food workers to deduct part of their salary and direct it toward a nonprofit organization”
- “ban on-call scheduling at retailers with 20 or more employees”
To say the least, these new requirements will give pause to an aspiring entrepreneur seeking to purchase and operate a fast food franchise in New York City. Or these added costs on employment and making running a business more difficult will spur automation—install kiosks and increase mobile ordering and mobile pay—at these establishments, something that is already occurring.
A surefire way to lessen the burden of these requirements is to employ robots instead of humans. A kiosk that takes orders or robots that flips burgers does not worry about scheduling. Well known franchises like McDonalds and Wendy’s are already replacing entry-level jobs with thousands of kiosks to reduce labor costs.
As I’ve previously written:
Fewer entry-level job opportunities hurt workers now and into the future, because an early start in the workforce is crucial to future success. Research shows that when young people get early work experience, they tend to earn higher wages in the future, and many get their first work experience at franchise establishments like McDonald’s, KFC, Subway, Taco Bell, or Baskin Robbins.
In addition to creating difficulties for employers in operating a store, the legislation makes fast food restaurants act as bill collectors for union front groups that protest and generall, try to disrupt their operations.
Placing greater costs and burdens on employers is bad for business, which also harms worker opportunity. While the legislation is meant to be worker-friendly, pricing low skilled workers out of a job is a poor way of showing them support.