The Challenge
California passed a new law to stop surprise charges in various industries, specifically in the hotel and travel industries. In May 2024, it was clarified that restaurant service fees, such as automatic charges for large groups, would be impacted, causing concern in the restaurant industry regarding their ability to maintain great pay equity between servers and back-of-the-house employees. Restaurants needed urgent changes to the law before it took effect on July 1, 2024, to avoid major disruptions.
solution
- On behalf of the California Restaurant Association, KP Public Affairs worked with the original law’s author to introduce a new bill to protect restaurant service fees.
- They brought together key supporters, including lawmakers and a major union representing restaurant workers.
- With both employers and labor in support, they pushed the new bill through the Legislature, overcoming opposition from the Attorney General.
results
- The new bill passed with unanimous approval and was signed into law by the Governor just before the original law took effect.
- Restaurants were able to keep using service fees without violating the law.
- This helped maintain fair pay for restaurant workers and allowed businesses to avoid financial harm.