San Francisco Chronicle

Newsom’s office: Panera not exempt from $20 wage law

- By Sophia Bollag Reach Sophia Bollag: sophia.bollag@ sfchronicl­e.com; Twitter: @SophiaBoll­ag

A day after Bloomberg reported that Gov. Gavin Newsom pushed for an exemption from a fast-food minimum wage law that benefits Panera Bread, Newsom’s office said it had reviewed the law and determined Panera is not exempt after all.

The law requires fastfood chains to increase their workers’ minimum wages to $20 an hour on April 1. It contains an exemption for fast-food restaurant­s that bake and sell their own bread, which Bloomberg reported effectivel­y carves out Panera from the minimum wage requiremen­ts.

Bloomberg reported that the arrangemen­t benefits longtime Newsom donor and business associate Greg Flynn, who owns two dozen Panera locations.

The Chronicle reached out to the governor’s office for comment Wednesday, the day the Bloomberg story broke.

At the time, Newsom’s office did not answer questions from the Chronicle about why Panera and other bakeries deserved a carve-out, whether Newsom spoke with Flynn about the legislatio­n and about Newsom’s personal connection­s to Flynn. Spokespers­on Alex Stack instead provided a statement in response to Bloomberg’s reporting.

“This legislatio­n was the result of countless hours of negotiatio­ns with dozens of stakeholde­rs over two years,” Stack told the Chronicle in the Wednesday email. “Staff in the Governor’s Office met with dozens of business owners as well as union representa­tives — as is expected when policies of this consequenc­e are moving through the Legislatur­e.”

A day later, after the Chronicle reported that a top Republican lawmaker

was calling for the governor to be investigat­ed, Stack followed up with more informatio­n.

“The Governor never met with Flynn about this bill and this story is absurd,” Stack wrote in a

Thursday afternoon email. “Our legal team has reviewed and it appears Panera is not exempt from the law.”

Stack said lawyers for the governor’s office determined that Panera doesn’t meet the standard for a business that “produces” bread “for sale on the establishm­ent’s premises” because “many chain bakeries (such as Panera Bread) mix dough at centralize­d off-site locations and then ship that dough to their retail locations for baking and sale.”

Panera Bread did not immediatel­y respond to questions about whether it agrees with the governor’s interpreta­tion or whether it plans to raise its California employees’ minimum wages.

 ?? Damian Dovarganes/Associated Press ?? Gov. Gavin Newsom signs the fast-food wage bill surrounded by workers on Sept. 28, 2023. Newsom’s office said Panera is not exempt from the $20 wage law.
Damian Dovarganes/Associated Press Gov. Gavin Newsom signs the fast-food wage bill surrounded by workers on Sept. 28, 2023. Newsom’s office said Panera is not exempt from the $20 wage law.

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