In an attempt to question the over-regulation of businesses, Senator Tillis argued that signs reminding employees to wash their hands should not be enforced. This, among other issues on over-regulation, is what the Senator is implying when he said that restaurant workers shouldn’t wash their hands.
There has been an ongoing debate on over-regulation and wage increases, and many restaurant owners have struggled through the years with increasing laws to legitimize businesses and increases wages for the service staff. In New York City alone, setting up a restaurant requires establishments to go through the community board. To get approval from the community board, over 30 licenses have to be secured by 20 inspections. Without the community board approval, it is impossible to get a liquor license.
Apart from the licensing, restaurants also face the rising costs of labor since there are new laws on overtime and penalties must be paid for workers that work more than 10 hours. This is a losing battle for both employer and employee. The employer who would want to keep his more efficient staff is tied up and cannot ask for longer hours, while the employee who wants to earn more is also limited to a 10 hour shift. The issue of healthcare is also adding to the restaurant’s expense, as all employees are supposed to be provided with equal healthcare benefits and all are subsidized by the employer. For small businesses, this would bloat the overhead, and eventually would have to shut down.
Big chain restaurants like Swiss Chalet and Houlihan’s Restaurant also are burdened by these regulations as higher wage costs will eventually have an impact on the prices on the menu.
The issue of over regulation even transcends to placing calorie counts on all menu, food labels and even popcorn. Many restaurant owners are angry because most of the regulations on labelling are inconsistent, causing for much cost on the business end.
The strict regulations in the US are actually driving the bigger restaurants to set up shop overseas, where rules are loose and business friendly. In one report by CNBC.com, Andy Puzder, President and CEO of CKE, or the parent company of Carl’s Jr. and Hardee’s, “named ethanol regulation, which has resulted in higher beef costs, a rising minimum wage and higher labor costs due to Obamacare as three obstacles that make doing business in the U.S. more difficult than in the past. To help lessen the effect of these rising labor costs and to attract a tech-savvy generation, CKE is turning to technology and looking into options for mobile ordering as well as tablet ordering within its restaurants.”
CKE now has expanded more stores globally than locally. Puzder said, “Under the current U.S. business climate, regulatory and tax restrictions tend to curb otherwise dynamic entrepreneurial energy. We’d love to see more growth in domestic markets. Unfortunately, it’s easier for our franchisees to open a restaurant in Siberia than in California.”
Senator Tillis statement over hand-washing (and the stopping of) is a statement of challenge to restaurants to act against over regulation. He is pointing out that deregulation over restaurants should start now, since all of the current policies are hurting the food industry.
According to US News, the Senator said, “I was having a discussion with someone, and we were at a Starbucks in my district, and we were talking about certain regulations where I felt like ‘maybe you should allow businesses to opt out.”
Between issues on cost, overhead, straining labor laws, and inflation, restaurant owners aren’t getting much love from government. The current trend suggests that the small owners are struggling to keep afloat, while the bigger companies are trying to get out of the country. In no less than a few years, the restaurant industry will be crippled and not expand at all.
Aside from these challenges, the food industry is trying to survive the mess by going the challenging these regulations through the courts. Despite the cost cutting, over regulation is still hurting them in other business areas. In a new FDA regulation, restaurants are now required to put calorie counts in all menu items. The National Restaurant Association is complaining that the cost of reprinting menus will hurt them once again, and added to this fact is the potential effects on the consumers once they know the total calorie count in their food. The NRA claims that many consumers will be too weight conscious and will be overwhelmed by the calorie count, and without proper education on how food and nutrients consumption should be managed.
So Senator Tillis might shock and perhaps be a little gross, but his points are well taken by many restaurant owners.