Newsom Denies Minimum Wage Exemption For Political Donor

The Panera Bread franchisee who is a major donor of California Governor Gavin Newsom said on Wednesday that his Panera Bread restaurants in California would be paying employees the state’s new $20-an-hour minimum wage starting on April 1, contrary to previous claims that his restaurants were exempted from the law, the Associated Press reported.

Governor Newsom signed a new minimum wage bill into law last fall requiring all fast-food restaurant chains with a minimum of 60 nationwide locations to pay California workers $20 an hour starting April 1, 2024.

The law exempts restaurants that bake and sell bread, an exemption that appeared to include Panera Bread.

Bloomberg News reported in late February that Governor Newsom pressed for such an exemption to benefit Greg Flynn, a major donor of the governor’s whose company owns 24 Panera Bread locations in the state.

Alex Stack, a spokesman for Governor Newsom flatly denied the claim, calling the Bloomberg report “absurd.”

Stack said the governor’s legal team reviewed the law following the Bloomberg report and determined that Panera Bread restaurants were not exempt since the bread was baked off-site.

In a February 29 statement, Flynn conceded that he had opposed the initial bill and suggested that the legislation should distinguish between fast food and “fast casual restaurants” so that bakeries, delis, and bagel shops would be exempted from the new minimum wage since the bill was aimed at addressing “alleged labor code violations in fast food restaurants.”

However, Flynn insisted that he never asked the governor for any exemption.

In a March 6 statement, Flynn said all of the Panera Bread locations owned by his company in California would begin paying its hourly workers the new minimum wage “or higher” starting on April 1. He explained that his company’s goal was to “attract and retain the best team members.”

In his earlier statement, Flynn noted that exempting Panera Bread from the higher minimum wage law would have “very little practical value” since the restaurants would need to raise their hourly wages if they hoped to compete with California fast food restaurants for workers.