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How Puzder’s appointment could ease restaurants’ labor woes

andy puzder

The selection of a chain restaurant executive as Donald Trump’s nominee for Secretary of Labor has raised expectations that restaurateurs and other employers may be spared the worst of looming changes in workforce regulations. Andy Puzder, who’d be stepping down as CEO of the company that franchises Carl’s Jr. and Hardee’s, was sharing his thoughts on such matters as a $15 minimum wage and the joint employer statute long before his name came up as a potential member of the President elect’s cabinet.

Here’s a review of what he’s said on labor issues of import to the restaurant industry.

Minimum wage

Puzder has flatly stated his opposition to “dramatic” increases in the federal minimum wage, but has allowed that raising the pay floor above the current $7.25 an hour could be manageable. In that regard, he’s articulated what many chain restaurant CEOs have said privately or at industry events.

But he’s also warned more publicly than most peers that any increase in the minimum wage will taper job growth and foster more replacement of positions with technology.

Robotics

After visiting Eatsa, the modern-day version of the automat, Puzder wondered aloud about the prospects of Carl’s or Hardee’s trying a similarly high-tech format where many human functions were shifted to machines. That led to general business stories that the fast-food veteran was looking to replace all of the chain’s employees with robots, though he never went that far in his comments.

At the Restaurant Leadership Conference, Restaurant Business’ annual gathering of C-suite executives, Puzder was asked while on the stage for a clarification. He said the idea of a staffless restaurant was intriguing, and that Carl’s or Hardee’s might try one as an experiment. But he did not call for the wholesale replacement of restaurant workers with robots.

Still, Puzder has been demonized by organized labor for his positive characterization of restaurant automatons: “They’re always polite, they always upsell, they never take a vacation, they never show up late, there’s never a slip-and-fall, or an age, sex or race discrimination case,” he told Business Insider.

Overtime pay rules

A suspended mandate that restaurants pay overtime to any salaried employee earning less than $47,476 annually has been blasted by Puzder as an example of overregulation. He’s also predicted that the measure would likely backfire and cost restaurant managers some of the flexibility they currently enjoy. If they’re going to get paid for 40-plus hours, they’ll be expected to work the specific 40-plus hours that their employers specify, he’s said in his writings and comments.

Puzder’s opposition is widely seen as increasing the likelihood that the Trump administration will roll back or phase in adoption of the new pay standards, which were promulgated by Labor.

Joint-employer standard

Puzder has characterized the National Labor Relations Board’s reclassification of franchisor-franchisee relations as a “lose-lose,” a measure that will do no good for any party except the unions that have failed to win restaurant employees’ support in other ways. However, it is not clear how he could weigh against the standard, given the independence of the NLRB from Labor. But he would presumably have Trump’s ear when vacancies on the board are filled.

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