Dear Emeryville Councilmembers:

Oakland Indie Alliance, representing dozens of Oakland restaurants, has been engaged in various Bay Area Cities examining worker-centered legislation which is being advanced in various ways. Many of our members have restaurants in multiple cities (including Emeryville), and are concerned about the ongoing series of changes to laws at the state and municipal level which are threatening our continued existence.

With regard to the EBASE/ACCE-sponsored ‘Fair Workweek’ proposal in front of Council. We urge you to:

Exercise caution with regard to increasing legislation which affects small businesses, either directly or indirectly
Create a clear definition of small/local business, which will help limit the impact workers' rights measures to their intended targets: formula retail and fast food. Attached is a draft of a proposal that we're working on with Oakland City Council that might be applicable in Emeryville
If you value small/local business in Emeryville, take concrete action to not just protect, but help us continue to exist. Emeryville is already predominantly a formula retail town, and small businesses are losing. In the last 12 months, some of our peers have closed their Emeryville restaurants - this will accelerate and continue if without some corrective action.

It's important that you understand that small locally owned restaurants and other small businesses, especially those which are labor-intensive, are suffering as we navigate the current economic transition. We absorbed an unprecedented increase in minimum wage just a year ago, and the effects of this change have yet to fully unfold. Although our workers are heavily tip-compensated, we’re still required to pay this higher wage, which exacerbates problems of wage inequity in our own businesses that we’re working to address. At the same time, both commercial and residential rents are increasing in double digit percentages annually, and our supply chain, which is absorbing all these costs, is passing them on to us in the form of increased cost of goods. As we raise our prices to compensate for these increased costs, we're alienating many of our long-time customers - regardless of their sympathy for our situation or that of our workers, many are just unable or unwilling to pay more.

We as small business owners are watching our profits evaporate, and with more changes looming, we're not optimistic about our future.

We are supportive of fair wages and good working conditions for workers, but without some relief, you'll be throwing out the baby with the bathwater - small businesses will fail and be replaced by chain stores. Opportunities for small-scale entrepreneurship will become increasingly daunting, or flat out not worth it. All this is bad for our workers, and bad for our local economy, now and in the long run.

Dear Emeryville Council, EBASE and ACCE:

We recently received a copy of this memo authored by EBASE, and are concerned about impacts of our businesses of continuing to absorb additional staffing costs that we would incur as a result of this and other worker-focused proposals.

We’ve spoken to Jennifer Lin of EBASE, who indicated that the proposal is intended to be limited to retail and fast food workers. This wasn’t clear to us in the written memo; although the memo mentions that these workers would receive the most benefit, it includes no clear statement excluding restaurants. Clarity in this area is essential, but still doesn’t insulate us entirely from the impacts that these suggestions would create.

We're generally worried about the de facto approach being adopted around this and similar issues, which creates a tiered employment environment for workers: where certain businesses are forced to comply with some rules, while other businesses are exempt. In reality, we as small businesses must compete for the same employee resources as our larger cousins, and creating incentives which allow those large employers to better attract and retain employees will inevitably result in increased costs and lower margins for us.

This proposal arises while we're still adjusting to an unprecedented increase in minimum wage, which directly and significantly affected us, and left us vulnerable. We supported this new higher wage, but now need time to adjust and achieve a new equilibrium. We’re also preparing for what we think is already likely: implementation of a statewide $15 wage, which would continue to increase our costs over the next several years. We worry that these suggestions would create additional pressure to implement these in our businesses, which we would vigorously protest.

And, we’re frustrated that in the demonization of certain (large, non-locally held) employers, those of us who are conscientious and work hard to balance the needs of our business against the needs of our workers and help sustain our local economy and tax base aren’t being recognized for doing so. Most conversations about wages and worker protections are not including the nuance of the conditions and challenges of local businesses. We’re watching as stories like the Genova Delicatessen’s loss of their lease unfold, and understand that we’re all at risk in these uncertain times.

We’d be happy to meet with you to discuss this situation further.

For now, here are our key concerns, following the points in the memo:

1) Three week rolling schedules are impractical in restaurants

Restaurant staffing is driven by demand and revenue, which often fluctuate dramatically with no warning. Bookings of large parties, catering orders, nearby events, events in the restaurant and other factors happen much less than three weeks in advance. We need the ability to react to these and keep our businesses efficient. Staff sickness (or other absences) and turnover also inevitably affect the entire schedule on a regular basis. Staffing inefficiency leads to increased prices, which limit our customer base's ability to pay, and impacts our revenue, which further reduces our ability to support additional costs. This can become a dangerous or terminal spiral if not done carefully.

We are working in most cases with single-digit percentages of profit in our businesses, and must pass on additional costs to our customers. In most cases, costs must be passed proportionally, not dollar-for-dollar, since every cost has associated overhead. A 1% change in the cost of our payroll is a really big deal, and we react to these changes aggressively.

A possible unanticipated consequence of this proposal: to protect ourselves against unplanned fluctuation, we might be forced to write in more shifts than are actually required for a given day to protect against these fluctuations, and send employees home more often than we already do. This would achieve exactly the opposite of the stated goal, and would further limit our ability to attract and retain good employees.

It is already necessary for us to accommodate fluctuating availability on the part of our employees. Many of our employees are unable to commit to their schedules more than a week in advance, and we’re often scrambling to help cover open shifts created because employees vacate them with little notice. It's unfair for us to bear the burden of predictability when faced with unpredictability - providing for some level of reciprocal accountability (e.g. employee-paid fines when the problem is created by an employee’s actions) would help this.

We are supportive of 'best-effort' measures to post schedules in advance, but consider the basic request impractical and counterproductive for our small businesses.

2) 'Predictability Pay' further compounds cost and pricing problems

Further penalizing the business for necessary adjustments brought by factors that aren't our fault is counterproductive, and multiplies the effect of staffing inefficiency, leading to increased prices or unsustainable businesses.

Again, in most cases, scheduling problems are created by forces we don’t create: employees quitting with little or no notice, employees calling out sick and needing day-of coverage, customer demand in the form of large parties or catering orders, etc. When we make changes to the schedule to deal with these problems, the proposal calls for unilateral penalties borne by the employer. This doesn’t reflect the reciprocal nature of employment and the responsibilities of both parties to do their part.

3) We generally already do allow workers to refuse to work back-to-back shifts

This is already a general practice for hourly workers - we may ask a worker to pull a double or work a 'clopen' shift, but we try to reduce the necessity of this for all sorts of reasons.

4) Giving existing employees access to additional hours before hiring new staff doesn't solve our staffing need

A major part of the problem of managing a restaurant schedule is retaining enough employees on the payroll such that all shifts have adequate potential coverage (in case a worker calls out sick, or requests planned time off). If we're scheduling all our available employees, we cannot react to unplanned events. Unlike many other businesses, we must have adequate staff when our customers walk in the door or place a phone or web order - we cannot put off the work to set a table, make a plate or a drink, or take someone's payment until we have enough staff - we have to do it immediately. If we're unprepared, our service suffers, which directly affects our business.

Because of the finite nature of our business, we can only support a certain number of shifts on our schedule, and it may not be possible for us to give every employee the hours they want, but still not have enough coverage at key times. We understand that our employees are in-demand resources, and we're motivated to work with them on scheduling requests - the alternative is losing them to another business who can do more for them. We’re also not in the practice of hiring unnecessary workers - each person on our schedule creates supervisory overhead, back office costs, and additional liability for us. These realities already discourage us from making frivolous hires.