Restaurant And Hospitality News – May 30, 2016

By Christine Kern, contributing writer

In news this week, California restaurants are cautioned to list BPA exposure risks; digital signage can help restaurants meet the new FDA menu labeling requirements; and a New York State lawsuit labels Domino’s as a joint employer, raising once again the issue of franchisees and joint employer status.

Restaurants In California Now Advised To List BPA Levels

BPA, a chemical commonly found in plastics, has been listed under California’s Proposition 65 law as a possible carcinogen and a toxin that may cause reproductive harm. Previously, the rules were believed to apply mainly to the manufacturers, packagers, importers, and distributors of foods or drinks in bottles and cans, as well as vending machines, but now California restaurants are being advised to warn consumers about potential BPA exposure as well, according to the Nation’s Restaurant News.

According to Pillsbury  Winthrop Shaw Pittman Law, “Failure to provide the required warning for products sold or distributed into California that potentially contain BPA could expose restaurants and their vendors to considerable liability under Proposition 65.” They explain, “Although these emergency regulations do not directly address sales of these products by restaurants, prudent restaurant operators should post Proposition 65 warnings concerning BPA given the likely, and potentially very costly, enforcement of Proposition 65 by private individuals.”

Graves and Pillsbury partner Corrie Plant, the firm’s Prop. 65 specialist, explained that many of the toxins listed under Prop. 65 allow for a generic warning to protect businesses from liability, noted Plant. Some suppliers are notifying restaurant operators that the generic Prop. 65 safe harbor statement may be enough.

“But we’re taking the most conservative approach,” said Plant, given California’s history as a hotbed for aggressive plaintiff’s attorneys who look for opportunities to sue.

The emergency regulations require the following warning for products potentially containing BPA:

WARNING: Many food and beverage cans have linings containing bisphenol A (BPA), a chemical known to the State of California to cause harm to the female reproductive system. Jar lids and bottle caps may also contain BPA. You can be exposed to BPA when you consume foods or beverages packaged in these containers. For more information go to: www.P65Warnings.ca.gov/BPA

Using Restaurant Boards To Be FDA Compliant

Restaurant boards can help business owners meet the latest FDA regulations for food labeling, according to Digital Signage Today. The use of digital menu boards provides the ability to segment on-screen content to allow for space to list not only menu items and prices, but also feature in-house promotions and external advertising, and provide nutritional information now required by the FDA. 

The FDA guidelines state, “As required by statute, FDA’s final rule for nutrition labeling in chain restaurants and similar retail food establishments will provide consumers with clear and consistent nutrition information in a direct and accessible manner for the foods they eat and buy for their families. Posting calories on menus and menu boards and providing other nutrient information in writing in chain restaurants and similar retail food establishments will fill a critical information gap and help consumers make informed and healthful dietary choices.”

Digital signage allows users to integrate real-time data to drive the content on the screen, and dynamically alter to showcase time-sensitive menus and information, including nutritional information, easily. And by providing a way to cycle through information quickly, restaurants can provide the necessary data to consumers while still maintaining brand image and enticing features for its customers.

Wage Theft Lawsuit Raises Issue of “Joint Employer” Status For Franchises Yet Again

The New York State attorney general Eric Schneiderman has accused Domino’s Pizza Inc. and a trio of franchisees of wage theft, alleging that the company’s software system under-calculated gross wages for workers to the tune of $567,000. The suit names Domino’s as a “joint employer,”  and states that the underpayments date back to 2011, according to the Nation’s Restaurant News. Schneiderman supported the suit, stating, “At some point, a company has to take responsibility for its actions and for its workers’ well-being. We found rampant wage violations at Domino’s franchise stores. And, as our suit alleges, we’ve discovered Domino’s headquarters was intensely involved in store operations, and even caused many of these violations.”

But Domino’s executives state that they made a “good faith effort” to rectify the problem to ensure their franchisees were complaint with labor laws. “We were disappointed to learn that the attorney general chose to file a lawsuit that disregards the nature of franchising and demeans the role of small business owners instead of focusing on solutions that could have actually helped the individuals those small businesses employ,” asserted Domino’s spokesperson Tim McIntyre.

This is not the first time the issue of “joint employers” has been raised regarding franchises. In 2014, the National Labor Relations Board (NLRB) charged McDonald’s as a joint employer for franchisee labor violations, raising a debate over joint-employer status. The 2014 move by the NLRB was “the latest in the NLRB’s ongoing endeavor to come up with inventive ways to get more and more employees to unionize,” explained Julie Capell, a partner in Winston and Strawn’s Los Angeles office. “This decision is particularly alarming because it’s signaling the future of the joint employer doctrine with the NLRB. And if the NLRB’s argument that big companies should be responsible for their franchisees succeeds, then it will have to expand the definition of what constitutes a joint employer.”

The New York case against Domino’s would certainly indicate that the boundaries of “joint employer” status are being pushed once again. As Heather Smedstad, McDonald’s USA senior vice president of human resources, said in 2014, “McDonald’s serves its 3,000 independent franchisees’ interests by protecting and promoting the McDonald’s brand and by providing access to resources related to food quality, customer service and restaurant management, among other things, that help them run successful businesses. This relationship does not establish a joint-employer relationship under the law.” Domino’s would likely argue that they play a similar role for their own franchisees.