This week’s 5 head-spinning moments: Election ups and downs

The restaurant industry has never had a better chance of tempering the impact of the Affordable Care Act than it will when the Congress reshaped by this week’s election takes office next year.

And that’s just one head-turning implication of Tuesday’s balloting, though not all of the outcomes will crank necks for positive reasons. Even the improved shot at easing the ACA’s burdens comes with an unmistakable asterisk. Restaurateurs with true wonk credentials likely had their heads continuously rotating left and right, from encouraging outcomes to ones decidedly less so, as the poll results were tallied.

For the sake of everyone else, here are the implications tagged by political pundits, including those from our own industry, as deserving a turn of operators’ heads.

1. A shot at ACA reform

Overall, “the industry is in a much better place now than it was before Tuesday,” says Scott DeFife, executive vice president of policy and government affairs for the National Restaurant Association—in essence, the industry’s top lobbyist. Of particular importance to restaurants is the Republican Party’s capture of the Senate, where many pieces of legislation favored by the industry have gone to die. Democratic Senate Majority Leader Harry Reid had refused to even consider measures like adjustments in the ACA.

Now “we should be able to get on the agenda of the Senate changes to the ACA that should be made,” says DeFife. At least the proposals would be considered by the chamber, and the likely new majority leader, Republican Mitch McConnell, has already expressed support for one of the industry’s key objectives, changing the definition of fulltime workers under the Act to those who put in 40 hours a week, not 30. 

2. The asterisk, a possible bummer, and another asterisk

DeFife said he wouldn’t be surprised if Congress approved the 40-hour rule and the other changes most desired by the NRA. But the legislation would likely face a veto by President Obama. For the same reason, the industry is foolhardy to believe there’s any chance at an outright repeal of the healthcare legislation.

But DeFife says he’s not sure the adjustments will die with a veto. He notes that there’s been more support for earlier fine-tunings than the votes suggested, and it comes down to Democrats wondering, “Wouldn’t it be better for the party if the legislation works, and wouldn’t these changes do that?

3. Better government hires

The Republicans’ takeover of the Senate could also land friendlier figures in government agencies that have all but invited the industry to a rumble in recent months. Because the body approves Presidential appointments, it can keep candidates with no appreciation for the interests of business employers from filling key vacancies at the National Labor Relations Board, the Equal Employment Opportunity Commission, or even the Department of Labor. All three have been accused by the industry of overstepping their regulatory mandates and unfairly burdening employers and franchisors.

4. When going local isn’t good

With Republicans controlling both the Senate and the House of Representatives, the chances of hiking the federal minimum wage by a large margin are slim at best. But that doesn’t mean the industry will see be spared attempts to push even starting pay well above $10 an hour. With inactivity at the national level, organized labor and other proponents of quantum pay leaps are expected to shift their focus to states, counties and municipalities.

Republicans also gained control of more state governments, which should be a brake on irrational labor proposals of any sort. But here’s the twist.

5. Fear the ballot initiative

If pay hikes can’t be ramrodded through legislatures, proponents are widely expected to ask voters directly for the increase through ballot initiatives. Five state-level wage proposals were put to a vote on Tuesday; all passed, and four were states with a decidedly Republican bent.

The ballot was also used to secure paid sick leave in Massachusetts, and to pass a tax on sugared sodas in Berkeley, Calif.

The measures are difficult to counter because they in effect ask voters, Would you or your neighbors like a raise? Or a day off when you’re sick?

The pundits agree that initiatives will be used increasingly in subsequent elections to secure controversial employer mandates that legislatures would rather not consider. One of the unions looking to organize more restaurant workers, the Service Employees International Union, has already vowed to get wage-hike initiatives on the ballot of more than 20 states in 2016.

To be sure, the political picture is much sunnier for restaurateurs than it was before the election. But it doesn’t mean there won’t be some storm clouds.

Says DeFife, “It’s a much better environment than we’ve had. [But] no one should be sanguine that all of our problems will go away. It’s not over; it’s just starting.”


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