Business
Indian rival slams Uber’s business model
Uber’s prime rival in India has some unsolicited recommendation for the U.S. startup: Go native.
“They’ve a really cookie-cutter strategy when it comes to what the mannequin is and the way [to] drive feed it into any geography,” Pranay Jivrajka, a prime govt at Ola Cabs, mentioned on the sidelines of CNN’s Asia Enterprise Discussion board in Bangalore.
Jivrajka, who till just lately served as Ola’s COO, mentioned that Uber ought to ditch its one-size-fits-all strategy and as an alternative attempt to perceive “native nuances” that will assist it to establish companies that “customers and drivers truly need.”
Uber declined to touch upon Jivrajka’s remarks.
Uber and Ola have for years waged a bitter battle for supremacy in India, a market with 1.3 billion potential clients. The nation has taken on elevated significance for Uber after a sequence of latest setbacks elsewhere in Asia.
The San Francisco-based firm suspended its operations in Taiwan final week, six months after it bought its operations in China to native rival Didi Chuxing. Didi, which is taking the combat to Uber in key international markets, is certainly one of Ola’s buyers.
In India, Uber has typically discovered itself enjoying catch-up with its Bangalore-based rival. Its most up-to-date native product providing — permitting Indian customers to e book a automobile for a whole day — is already supplied by Ola in 85 cities.
Ola additionally lets customers e book certainly one of India’s ubiquitous three-wheeled auto rickshaws, a service Uber began however then discontinued in 2015.
“What has helped us is having an ear to the bottom when it comes to understanding what the customers need,” mentioned Jivrajka.
Associated: Uber’s rivals are teaming up in Asia
Uber CEO Travis Kalanick insists that his firm is just not ready to go away India.
“We’re shedding, however we see a path in direction of profitability,” Kalanick mentioned throughout a December go to to Delhi. “We see ourselves being right here in the long term.”
Associated: Uber suspends its service in Taiwan as fines mount
India is not at all times a simple marketplace for both firm — tens of 1000’s of drivers representing each Uber and Ola went on strike in Delhi this week, demanding higher pay and advantages. The Delhi authorities has supplied to mediate the dispute.
Jivrajka didn’t touch upon the protests, however mentioned that Ola’s primary focus stays bringing extra drivers onto its platform.
“We want extra drivers as a result of the tempo at which demand is rising is method larger than the best way provide is getting aggregated,” he mentioned.
Associated: Uber CEO drops out of Trump’s enterprise advisory council
Jivrajka additionally had some recommendation for one more Silicon Valley big hoping to enter India: electrical automaker Tesla.
“There aren’t any guidelines on the Indian roads,” Jivrajka mentioned. “One factor lots of people say is that in case you can drive in India, you may drive wherever.”
— Manveena Suri contributed reporting
CNNMoney (Bangalore, India) First revealed February 13, 2017: 8:48 AM ET
Business
Column: A Faulkner classic and Popeye enter the public domain while copyright only gets more confusing
Last year, it was Mickey Mouse. This year, Popeye the Sailor joins Mickey as a new entrant to the public domain — that is, shedding his core copyright protections on Jan. 1.
He’s merely the most familiar cultural artifact to enter the public domain on Wednesday. But as Jennifer Jenkins, co-director of Duke University’s Center for the Study of the Public Domain notes in her indispensable annual roster of newly public works (posted this year with co-director James Boyle), Popeye’s initial appearance in print is among thousands of culturally and artistically significant works to become copyright-free. That means they become available for anyone to copy, share and expand upon without paying their creators for rights.
This year’s treasure trove includes literary works originally published in 1929, meaning their 95-year copyrights expire on New Year’s Day. They include William Faulkner’s novel “The Sound and the Fury,” in which he began to perfect his literary style and his gloss on racial and social stratification in his native Mississippi; Ernest Hemingway’s “A Farewell to Arms”; and Virginia Woolf’s essay “A Room of One’s Own.”
Community theaters can screen the films. Youth orchestras can perform the music publicly, without paying licensing fees. Online repositories … can make works fully available online. This helps enable both access to and preservation of cultural materials that might otherwise be lost to history.
— Jennifer Jenkins, Duke University, on the value of the public domain
There are also Dashiell Hammett’s “The Maltese Falcon,” originally published as a serial in Black Mask magazine, and John Steinbeck’s first novel, “Cup of Gold.”
Among films, the haul includes the Marx Brothers’ first movie, “The Cocoanuts,” which was based on a George S. Kaufman Broadway musical and betrays its stagebound genesis in almost every scene; Alfred Hitchcock’s first sound film, “Blackmail,” and an early film adaptation of Edna Ferber’s “Show Boat” — a 1929 version of Ferber’s novel, not the musical version, which was filmed in 1936 and, more familiarly, in 1951.
Interpretations of copyright law haven’t been as divergent as they’ve become over the last year or two. The reason is AI, or at least the development of AI bots “trained” on copyrighted written, musical and artistic works. Numerous lawsuits brought by creators are making their way through the federal courts.
AI developers generally claim that their feeding copyrighted works into their bots’ databases falls within the “fair use” exception to copyright protection. The fair use doctrine, as the U.S. Copyright Office puts is, allows the use of “limited portions of a work including quotes, for purposes such as commentary, criticism, news reporting, and scholarly reports.”
Whether a particular use qualifies “is notoriously fact-specific,” Jenkins told me. “So it’s hard to shoot a straight arrow through all the cases,” in part because the judgment of whether a use is exempt from copyright depends on whether creators can show that the use caused harm to the market for their works.
“It’s a wild patchwork of cases,” Jenkins says, “but the central issue to all is the same, namely is it fair use to train your AI model on copyrighted content, but the specifics vary. Often I have something resembling a prediction of how fair use cases are going to come out, but really cannot predict which way these cases are going to go. It’s a moving target in copyright land.”
This isn’t the first time that technological change has roiled the copyright landscape. One precedent is the Google Books case, in which authors and publishers sued Google to block its effort to create a searchable database of written works by digitizing copyrighted works along with works in the public domain.
The ultimate settlement allows Google to digitize books for the database, but to display only limited “snippets” of copyright-protected works to users — enough to enable users to search for specific words or phrases, but not to access significant portions of the works.
Also entering the public domain this week, as Jenkins observes, are about a dozen Mickey Mouse films, including one in which he speaks his first words (“Hot dogs! Hot dogs!”) and wears his iconic white gloves. That depiction of Mickey is now copyright-free; the ur-Mickey depicted in the Walt Disney short “Steamboat Willie” entered the public domain on Jan. 1, 2024, but later depictions such as the white gloves were still subject to copyright restrictions based on when they first appeared on film.
Popeye first appeared as a peripheral character in January 1929 in E.C. Segar’s “Thimble Theatre” comic strip. He garnered such instant popularity that Segar eventually refashioned the strip around him. Some story elements, such as the role of spinach as a source of his superhuman strength, became part of his persona over subsequent years.
Popeye also gives us a window into how a character’s entry into the public domain doesn’t require subsequent exploitations to adhere to his or her original conception.
Los Angeles copyright attorney Aaron Moss observes in his own curtain-raising post about public domain day 2025 that several Popeye-inspired horror films, “including ‘Popeye the Slayer Man,’ set in an abandoned spinach cannery, and ‘Shiver Me Timbers,’ featuring a meteor that ‘transforms Popeye into an unstoppable killing machine,’” have already been announced.
Similarly, er, disrespectful treatments of Mickey Mouse and Winnie-the-Pooh (a member of the public domain class of 2022) have been produced or announced.
The copyright rules for music are particularly convoluted. “Fats” Waller songs including “Ain’t Misbehavin’” and “(What Did I Do to Be So) Black and Blue” are entering the public domain, which should help to augment Waller’s reputation as a jazz and Broadway innovator. So too are George Gershwin’s “An American in Paris” and the popular standards “Tiptoe Through the Tulips” (lyrics by Alfred Dubin, music by Joseph Burke), “Happy Days Are Here Again” (lyrics by Jack Yellen, music by Milton Ager) and “What Is This Thing Called Love?” by Cole Porter.
But as Jenkins notes, only the compositions — what appears on the sheet music — and not any particular recordings are entering the public domain. So the version of “Tiptoe” recorded by Tiny Tim, which made that artist a popular star in 1968, is still under copyright.
“Singin’ in the Rain,” which most people associate with the 1952 film musical of that name, is entering the public domain.
Fans of the Gene Kelly/Debbie Reynolds film may be unaware that it was conceived by Arthur Freed, then the head of MGM’s musical feature unit, as a vehicle to exploit the back catalog of songs he and composer Nacio Herb Brown had written in the 1920s and 1930s; of the 16 full-length and excerpted songs in the movie, all but two were original products of their collaboration or had words by Freed or music by Brown. “Moses Supposes” was written by others for the movie and “Make ‘Em Laugh,” by Freed and Brown, was acknowledged by Stanley Donen, who co-directed the firm with Kelly, to be a transparent rip-off of Cole Porter’s “Be a Clown.”
(My favorite backstage nugget about the movie’s production involves the physical torment that Reynolds, not a trained dancer, suffered at the hands of the perfectionist Kelly, which left her with bloodied feet after filming the “Good Morning” number. A close scrutiny of the scene reveals Reynolds continually glancing at the ground to make sure she was hitting her marks as she tried to keep in step with Kelly and co-star Donald O’Connor; anyway, no one can claim it doesn’t work perfectly.)
Sound recordings from 1924 are entering the public domain thanks to the 2018 Music Modernization Act. They include Gershwin’s recording of “Rhapsody in Blue” and Al Jolson’s recording of “California Here I Come.” But regular sound recordings made in 1929 are granted 100-year copyrights, so they won’t be available until 2030.
Another exception covers music made to accompany movies, which receive the same copyright terms as the films. Accordingly, Jenkins notes, the recorded version of “Singin’ in the Rain” heard in the film “The Hollywood Revue of 1929” goes royalty-free on Jan.1, but not the version sung by Kelly in the 1952 movie.
The annual flow of copyrighted works into the public domain underscores how the progressive lengthening of copyright protection is counter to the public interest—indeed, to the interests of creative artists. The initial U.S. copyright act, passed in 1790, provided for a term of 28 years including a 14-year renewal. In 1909, that was extended to 56 years including a 28-year renewal.
In 1976, the term was changed to the creator’s life plus 50 years. In 1998, Congress passed the Copyright Term Extension Act, which is known as the Sonny Bono Act after its chief promoter on Capitol Hill. That law extended the basic term to life plus 70 years; works for hire (in which a third party owns the rights to a creative work), pseudonymous and anonymous works were protected for 95 years from first publication or 120 years from creation, whichever is shorter.
Along the way, Congress extended copyright protection from written works to movies, recordings, performances and ultimately to almost all works, both published and unpublished.
Once a work enters the public domain, Jenkins observes, “community theaters can screen the films. Youth orchestras can perform the music publicly, without paying licensing fees. Online repositories such as the Internet Archive, HathiTrust, Google Books and the New York Public Library can make works fully available online. This helps enable both access to and preservation of cultural materials that might otherwise be lost to history.”
Indeed, as Jenkins and others have documented, overly long copyright terms often keep older works out of the mainstream. “Films have disintegrated because preservationists can’t digitize them,” Jenkins has written. “The works of historians and journalists are incomplete. Artists find their cultural heritage off-limits.”
The countervailing benefits are minimal. The artistic lobby — specifically corporate owners of copyrighted content — maintain that longer terms protect the income streams of content creators, producing an incentive to create. But the truth is that after the first few years of publication the commercial value of the vast majority of copyrighted works declines precipitously to almost nothing. The value that might arise from follow-on creations of public domain works remains locked away and the copyrighted works become forgotten.
Business
Column: Business leaders bow to anti-DEI activists — except at Costco
It has long been clear that relying on corporate leaders to stand fast for social and economic progress is a mug’s game.
Big business talks the talk, of course. As I’ve written before, after the insurrection of Jan. 6, 2021, many corporate leaders pledged publicly to oppose the assaults from the political right wing on democracy.
Leading corporations said they would cease making campaign contributions to lawmakers who voted against certifying Joe Biden’s election or played a role in the insurrection in Washington.
Our efforts at diversity, equity and inclusion remind and reinforce with everyone at our Company the importance of creating opportunities for all.
— Costco responds to anti-DEI agitators
Some made similar promises about state laws restricting abortion or voting rights, or talked openly about reducing their activities in states enacting such measures. They promoted their commitment to programs fostering diversity, equity and inclusion, known as DEI.
When push comes to shove, however, most of these companies folded like a poker player with a bad hand. That’s been especially evident on DEI, which became a target in the “anti-woke campaign” waged by right-wing culture warriors such as Florida GOP Gov. Ron DeSantis during the late presidential campaign.
Anti-DEI activism on the right gathered steam after the Supreme Court struck down college affirmative action admission policies in June 2023.
Throughout this year, big corporations have retreated from the DEI landscape. The largest to do so is Walmart. In November, the company said it wouldn’t renew the five-year, $100-million commitment it made in establishing its Center for Racial Equity in the wake of the George Floyd killing, would cease using the term DEI and would end other diversity initiatives.
“We’ve been on a journey and know we aren’t perfect, but every decision comes from a place of wanting to foster a sense of belonging, to open doors to opportunities for all our associates, customers and suppliers and to be a Walmart for everyone,” the company said.
Ford, Harley-Davidson, Lowe’s and other companies said they would no longer provide workplace data to the Human Rights Campaign, a gay rights group, in part because the campaign’s widely published index of corporate progress enabled anti-LGBTQ+ activists to mount a backlash against participating companies.
That brings us to Costco. Almost uniquely among major public companies, Costco’s board has explicitly rejected the anti-DEI backlash.
The response from Issaquah, Wash.-based Costco came in the Dec. 11 proxy statement for its annual shareholder meeting, scheduled for Jan. 23. The meeting agenda includes a shareholder resolution proposed by the right-wing National Center for Public Policy Research, insinuating that Costco’s DEI program “holds litigation, reputational and financial risks to the Company, and therefore financial risks to shareholders.”
The resolution calls on the board to report on “the risks of the Company maintaining its current DEI … roles, policies and goals.”
The Costco board unanimously advised shareholders to vote against the resolution. “Our commitment to an enterprise rooted in respect and inclusion is appropriate and necessary,” it said in its response. “Our efforts at diversity, equity and inclusion remind and reinforce with everyone at our Company the importance of creating opportunities for all. We believe that these efforts enhance our capacity to attract and retain employees who will help our business succeed.”
The board took direct aim at the center, the resolution proponent, which it accused of hiding its true goal. Although the center “professes concern about legal and financial risks to the Company and its shareholders associated with the diversity initiatives,” the board stated, “it is the proponent and others that are responsible for inflicting burdens on companies with their challenges to longstanding diversity programs. The proponent’s broader agenda is not reducing risk for the Company but abolition of diversity initiatives.”
That swipe seems to have hit home. “The recent wave of companies walking back their DEI in response to no greater threat than merely having the truth about their DEI programs exposed,” center staff member Stefan Padfield told me by email, “makes clear that any related burden[s] these companies are experiencing are of their own making as they seek to misuse shareholders’ money to advance neo-Marxist and neo-racist ‘equity’ agendas.”
Costco says it doesn’t have any comment about the shareholder resolution beyond the board statement.
Although the Costco board didn’t go into detail, the center has assembled quite a record as a culture warrior. It’s a “partner” of the Stop Corporate Tyranny coalition, which describes itself as “a one-stop shop for educational resources exposing the Left’s nearly completed takeover of corporate America.” It has opposed initiatives to combat global warming, asserting that global warming isn’t happening, and it promotes cryptocurrency.
Costco’s straightforward response to the center’s proposed resolution may not be that much of a surprise. The company is generally known as employee-friendly, with favorable ratings from workers posting on Glassdoor. Among its benefits, health coverage with low co-pays is available to workers employed for at least 23 hours a week for 180 days.
Its approach to union organizing activity may not be entirely welcoming, but seems to lack the truculence and hostility shown by retailers such as Starbucks and Amazon.
Of Costco’s roughly 219,000 employees, about 18,000 are represented by the Teamsters. Remarkably, when 238 Costco workers in Norfolk, Va., voted to affiliate with the Teamsters a year ago, Chief Executive Ron Vachris and his immediate predecessor, W. Craig Jelinek, issued a joint statement blaming themselves.
They said they were “not disappointed in our employees; we’re disappointed in ourselves as managers and leaders…. The fact that a majority of Norfolk employees felt that they wanted or needed a union constitutes a failure on our part,” they wrote in a memo dated Dec. 29 and sent to all U.S. employees. CNN obtained a copy of the memo.
That doesn’t mean that labor relations are free of conflict: Early in December, the Teamsters union filed unfair labor practice charges with the National Labor Relations Board against the company for what it called the company’s “calculated effort to undermine workers’ rights and disrupt the collective bargaining process.”
Asserting that the company’s worker-friendly reputation is undeserved, the Teamsters said Costco had “expelled union representatives from stores, harassed and intimidated workers for wearing Teamsters buttons and attire, sent employees home, and even changed locks on union bulletin boards” to prevent the union from disseminating information to workers. Costco said it has no comment on the charges.
A few words about shareholder resolutions are appropriate here. Following the Supreme Court’s decision on college affirmative action, the number of resolutions about DEI programs receiving a vote at corporate annual meetings rose appreciably, to 25 through May this year from 13 in 2023, according to the Conference Board.
To be fair, that’s still a small number among the roughly 3,000 public companies in the Russell 300 index. More notable, however, is that anti-DEI proposals remained deeply unpopular. Resolutions opposing workplace diversity programs garnered support from less than 2% of shareholders, on average; those favoring such programs received support from an average of 21% of shareholders, however. (Shareholder resolutions proposed by almost anyone other than corporate managements seldom get anywhere near majority support.)
The Conference Board, a nonprofit corporate research consultancy, has found that diversity programs aimed at managers and the rank and file enhance corporate fortunes. Companies with diverse management teams “demonstrate 19% higher revenues due to innovation,” the board says.
Those with “higher racial and ethnic diversity [are] 35% more likely to have financial returns above their industry medians.” Commitments to diversity appeal to job applicants and tend to improve productivity.
On the other side of the coin are what the center’s Padfield claimed is “the wave of customer backlash we’ve seen against DEI.” He added, “rather than doing the right thing and evaluating the relevant risks … Costco is apparently doubling down on divisive and value-destroying DEI.”
The center told me by email that “one day, Costco will no longer have a DEI program. We hope for the sake of shareholders that it’s sooner rather than later.” Shareholders, workers and customers may hope for their own sake that the opposite is true — and that other businesses follow Costco’s example.
Business
These are the top 7 issues facing the struggling restaurant industry in 2025
Operating a restaurant in Southern California continues to be a difficult endeavor, with many establishments still struggling from pandemic losses.
Food and labor costs increased in 2024, remaining by far the largest expenses of running a restaurant, according to the Independent Restaurant Coalition. And the minimum wage is set to increase again in California starting in the new year — to $16.50 an hour.
Locally, several Los Angeles restaurateurs report that they have yet to recover from entertainment industry strikes last year, which severely affected the service industry. Paired with low patronage and pandemic-era loans and rent payments that came due, several acclaimed restaurants are struggling or have shuttered across the country, particularly in L.A.
Most recently, the well-regarded All Day Baby in Silver Lake closed on Dec. 15. Owner Lien Ta told The Times that the restaurant simply didn’t make enough money on a day-to-day basis to sustain operations.
It’s unclear what 2025 has in store for restaurants, but the needs of restaurants and bars are complex and numerous. Here are the top seven challenges restaurants are likely to face in the coming year.
Labor costs
Labor has long been a top expense for restaurants. In California, a larger percentage of the bottom line is spent on labor compared to other states. This doesn’t just mean the dollars for paying staff but includes other costs, such as payroll tax and workers compensation insurance.
It used to be that a good goal for a restaurant was for labor costs to be about 30% of gross sales. But many restaurants are spending much more. At some establishments, labor can account for 50% to 60% of the bottom line.
Ross Pangilinan, chef-owner of Terrace by Mix Mix restaurant at South Coast Plaza in Costa Mesa, said he spends the most on staff, which can account for up to 34% of his bottom line. The higher the labor, the more payroll tax and workers comp, he noted.
“Labor is going to be the No. 1 challenge” for 2025, said Pangilinan, who operates small, independent restaurants, including Populaire, also in South Coast Plaza.
Larger restaurants regularly poach his staff, he said.
“The restaurants can pay higher wages. They are paying their cooks over $20 an hour and smaller restaurants are trying to compete with that,” Pangilinan said. “We’re a tiny restaurant at Terrace — 70 seats or so. We’re not backed by a big corporation or big investors.”
To stay competitive he’s raised wages for his back-of-house staff, who also benefit from tip sharing, he said. “They deserve as much as the servers do. They are working more hours and they are working as hard and, sometimes harder, than the front of house.”
Food prices
Food prices are up 28% since 2019, according to the Consumer Price Index.
Higher production costs, labor and fuel costs are a few reasons that food is so much more expensive now than before the pandemic. Severe weather and disease have affected several essential crops and livestock. Also, global events such as the war in Ukraine have led to supply chain disruptions.
While the rate of growth has slowed, food costs are expected to still increase in the coming year.
Egg prices already are going up due to the accelerating spread of H5N1, a highly transmissible and fatal strain of avian influenza. The virus is to blame for below-normal levels of egg production that can’t keep up with consumer demand, which leads to higher prices.
Luis Perez, executive chef at Chapter One in Santa Ana, said he’s already paying about $114 for a case of 180 organic eggs. A few months ago, he was paying less than $100.
He’s bracing himself for what the cost will be in the coming weeks. “On any given week, we go through four to five cases of eggs,” Perez said.
In response, he’s had to pivot more often than in the past. For instance, instead of serving airline chicken, he’s dishing up less expensive chicken leg meat since a few months ago. Instead of filet mignon, he’s serving hanger steaks.
He stopped buying mixed greens months ago from local farmers markets because it was just too costly. Perez said he currently charges about $15 for a salad but would need to charge upward of $23 to justify the cost of farmers market greens.
Health insurance
Federal law requires employers with 50 or more full-time or equivalent employees to provide health insurance benefits with minimum essential coverage.
At the same time, the average cost of health insurance has increased for nearly every American. It’s no different for restaurant operators offering plans to employees. The average cost of single coverage health insurance was $8,951 in 2024, up 6% from the previous year, according to the National Restaurant Assn. For smaller outfits, the price was an average of $9,131.
Kerstin Kansteiner, owner of Alder & Sage in Long Beach, has a small staff and isn’t obligated to offer health insurance. Still, she decided to offer coverage to her six full-time employees. Three of them took her up on it. She also provides free dental insurance and a 401(k) plan.
“I promised myself, I can’t have health insurance myself and not offer it to my team,” she said. “We felt like we wanted to do the right thing.”
But that commitment comes at a price. Not long ago, Kansteiner said she got word from her health insurance provider that rates were increasing 17% to 19% in the coming year. She could switch to a lower-tier health insurance plan, but she said she doesn’t think it’s right.
“I ask my team to do the impossible every day,” she said.
She said she doesn’t quite know where she’ll find the money to pay her portion of the increase but doesn’t think she can pass it on to diners. Some already complain about prices on the menu, she said.
“I think we have to have a conversation with the public about what food really costs,” Kansteiner said.
Credit card fees
As use of cash in everyday transactions fades, credit cards have become the de facto way to pay for meals, and that means card transaction fees have become a growing monthly expense for restaurant operators.
The fees are particularly a burden on smaller independent restaurants, which already operate on the slimmest of profit margins.
Delilah Snell, who operates Alta Baja Market, a restaurant and market in Santa Ana, said card swipe fees take at least 3% of her bottom line.
“Three percent means everything over the course of a year,” said Snell, who sells an assortment of products and prepared foods sourced from Mexico, California and the U.S. Southwest. “If a business makes $500,000 a year and it’s a 3% fee just for credit cards? That’s a lot.”
Visa and MasterCard dominate the credit card market, controlling around 80% of transactions in the U.S.
“With little competition in the industry, these companies set the terms, leaving independent businesses with few options to reduce their processing costs,” according to a statement from the Independent Restaurant Coalition. “The lack of competition stifles innovation and prevents smaller restaurants from negotiating better rates or leveraging alternative payment systems.”
Child care
Affordable child care continues to be a major challenge for restaurant workers. Nearly 3.5 million parents work in the restaurant industry and more than 1 million of those are single mothers, 40% of whom live in poverty, according to a 2016 report by the National Women’s Law Center and the Restaurant Opportunities Center.
The rising cost of child care and the lack of flexible options put both parents and businesses under pressure, said the Independent Restaurant Coalition. Dan Jacobs, a “Top Chef” star and chef-owner of Dan Dan restaurant in Milwaukee, said that as his team expands, more of his staff are starting families.
“The rising cost of child care across the country presents a tough dilemma: Parents are forced to choose between remaining in the workforce or staying home with their children,” he said in a statement. “It’s disheartening that in a country as advanced as ours, basic parental leave and childcare support remain out of reach for so many. It’s time for a change.”
Delivery app fees
Meal delivery apps became ubiquitous during the pandemic, and the demand for food delivery continues to expand. The delivery app market — dominated by DoorDash, UberEats and Grubhub — seems to be a blessing and a curse for restaurant operators.
The apps helped restaurants survive during the COVID-19 pandemic, when everyone was hunkered down at home. But that convenience comes at a cost to restaurants.
The commission rates can be as high as 30% per order, according to the Independent Restaurant Coalition.
“For small and mid-sized restaurants, the costs and constraints imposed by third-party apps are unsustainable,” the IRC said. “High commission fees, coupled with marketing expenses, drastically reduce profitability.”
Caroline Styne, a restaurateur who is co-owner and wine director of the Lucques Group of restaurants, said her restaurant relies on third-party delivery apps because she’d rather get a sale than not get one.
“It’s a little like you’re damned if you do and damned if you don’t,” Styne said of delivery apps. “They have us in a stranglehold. And because of that they are able to continue and even increase their price as time goes on.”
Styne said she encourages diners who want food delivery to do so directly on the restaurant’s website, instead of going through a third party; that makes the fees slightly lower for restaurant operators.
Service charges and tipping
Service charges and junk fees came to the forefront this year after California prohibited “junk fees,” hidden online ticket sale fees and fees tacked onto hotels, restaurants, bars and delivery apps.
At the last minute in June, the state Senate passed an emergency bill to exempt restaurants from the service-fee ban.
Regardless of the 11th-hour reversal, the practice of service fees has been called into question and sparked lawsuits against restaurant operators over its use.
At the same time, the practice of adding service charges to restaurant checks has grown in Southern California and across the nation in recent years, giving rise to a debate about how the fees should be treated by customers and workers.
Several restaurant operators and industry advocates favor a service-charge model. Advocates say such a model can provide more equitable compensation to all staff so that pay is not reliant on factors such as customer satisfaction or implicit biases that may affect tipping behavior.
Mary Sue Milliken, chef and co-founder of Mundo Hospitality Group, whose restaurants include Socalo, Border Grill and Alice B, said she hopes the entire restaurant industry will one day turn to a service-charge model and get away from tipping, which she said can lead to “bad behavior” and an inequitable system where front-of-house workers get paid exponentially better than back-of-house employees.
But, she said, doing away with tipping would have to be done universally. Milliken compared it to how Beverly Hills in 1987 became the first city in California to ban smoking in restaurants — and most public places — while nearby cities continued to allow it.
“Beverly Hills had no smoking and all their restaurants were dead,” she said. “It has to be all in the state of California or the county of L.A. All have to do it to make it fair. There has to be some movement toward a better system.”
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