Panera Exempt from Business-Crushing California Law After Major Political Donation

A major donor to Democrat California Gov. Gavin Newsom is set to benefit from a special exemption in the state's new minimum wage law for fast food workers. This exemption lets some restaurants, like his Panera Bread franchises, pay lower wages.

Gov. Newsom advocated for this exemption. It permits restaurants that bake and sell bread to pay $16 an hour instead of the new $20 minimum wage. Greg Flynn, a billionaire and Newsom donor, could save significantly with this rule in his two-dozen California Panera locations, Bloomberg reports.

Flynn has financial ties to Newsom and has supported his political campaigns. He opposed the FAST Act, which introduced the higher wage, and lobbied for Panera's exclusion, sources said to Bloomberg.

A compromise between labor and the fast food industry led to the repeal of the original law. The new rules include the bread exemption and set the minimum wage at $20.

Flynn is a major U.S. franchise owner, with thousands of locations including Taco Bell, Pizza Hut, Wendy's, and Applebee's.

He has donated generously to Newsom, contributing $8,400 in 2018 and aiding in the governor's 2021 recall defense with a $100,000 donation. Flynn was among the top donors, along with Netflix's Reed Hastings and financier George Soros. The recall effort failed.

In 2021, Flynn gave $64,800 to Newsom's campaign and supported other California Democrats, including the Attorney General and Treasurer.

Responding to inquiries, a Newsom spokesperson said the legislation resulted from extensive negotiations without undue influence from any individual or company.

Flynn denied having a role in creating the exemption, as per Bloomberg.