Governor Gavin Newsom is responding to reports that Panera Bread will be exempt from California’s new minimum wage law for fast food workers. The governor now says that Panera Bread may not be exempt from the law after all.
The new law doesn’t recognize places that operate “a bakery that produces for sale on the establishment’s premises bread” as fast food, according to its text.
Why the line was drawn at bread remains unclear.
“That’s part of the sausage-making of politics,” Newsom previously said during a news conference when asked about the exemption.
However, multiple media reports published on Wednesday revealed that Newsom’s relationship with Greg Flynn, a billionaire and longtime donor who has two dozen Panera Bread locations in the Golden State, may have been the reason the exemption was included.
Newsom is firing back at those claims.
“The governor never met with Flynn about this bill and this story is absurd. Our legal team has reviewed it, and it appears Panera is not exempt from the law,” a spokesperson from Newsom told Nexstar’s Capital Reporter Eytan Wallace.
Nexstar Media Group is the parent company of KTLA 5.
Flynn has also been involved in Newsom’s campaigns, donating $100,000 in 2021 to help Newsom fight against a recall and $64,800 in 2022, which went to the governor’s reelection campaign, according to The Sun.
Representatives for Flynn provided this statement to KTLA regarding the exemption.
“It is true that I opposed AB1228, as did thousands of other California restaurant owners. If the intent of the bill was to address alleged labor code violations in fast-food restaurants, then the scope of the law should be limited to true fast-food restaurants and not include fast-casual restaurants like bakeries, bagel shops, delis, etc. I suggested the bill’s language defining ‘fast food restaurant’ should be amended to exclude fast-casual restaurants,” representatives for Flynn told KTLA in an emailed statement.
“To be clear, at no time did I ask for an exemption or special considerations. In fact, the idea never even occurred to me and I was surprised when the exemption appeared in the final legislation. I also never met with Governor Newsom about this bill, though I did meet with his staff in a group meeting with other restaurant owners,” the statement read.
Due to the backlash, California Republicans are now calling for an immediate ethics investigation.
“Friends of the party in power get exemptions, and that’s not right.” Assemblyman Joe Patterson (R- Rocklin) said. “If this is a bad law for one company, then it’s probably a bad law for other companies.”
Other companies that aren’t exempt from the law, like Chipotle, previously announced plans to raise prices in the Golden State.
