The resolution gives restaurants, bars, and other hospitality establishments additional time to comply with the alcohol server training requirement established under South Carolina’s recent liquor liability reforms. The original compliance deadline was March 2, 2026, but lawmakers recognized that many businesses and employees needed additional time to complete the training programs as they became available statewide.

“SCRLA is grateful to Governor McMaster and members of the General Assembly for recognizing the operational challenges facing our industry and taking swift action to extend this deadline,” said Douglas OFlaherty, Interim President and COO for the South Carolina Restaurant and Lodging Association. “This extension ensures that restaurants and bars across South Carolina have the necessary time to properly train their teams while continuing to serve their communities safely and responsibly.”

Alcohol server training is required for employees who serve alcohol for on-premises consumption 10 hours or more a week and for managers who oversee alcohol service. The training requirement is part of broader liquor liability reforms intended to promote responsible alcohol service and address rising insurance costs facing hospitality businesses.

SCRLA worked closely with legislative leaders, regulators, and industry partners to highlight implementation challenges and advocate for a reasonable extension that would allow businesses to achieve compliance without unnecessary disruption.

“South Carolina’s hospitality industry remains committed to responsible alcohol service,” OFlaherty added. “By extending the deadline to May 1, policymakers have provided a practical path forward that supports both public safety and the thousands of small businesses that make up our state’s hospitality community."

SCRLA encourages hospitality businesses and employees to take advantage of the extended timeline and complete an approved alcohol server training program before the new May 1 deadline.

This extension provides vital relief and flexibility to the state’s hospitality industry as businesses navigate the transition toward compliance with new liquor liability reforms under H. 3430.

“This is a significant and welcome win for South Carolina’s hospitality industry,” said Douglas OFlaherty, Interim President and COO of SCRLA. “Our members have been working diligently to comply with the sweeping changes under H. 3430, and this extension provides critical breathing room to ensure full and proper implementation without disrupting operations.”

The SCRLA expressed its sincere appreciation to the leaders who spearheaded this effort, including Chairman Weston Newton, Chairman Luke Rankin, and Senator Michael Johnson for recognizing the practical challenges facing small businesses across the state and acting decisively to address them.

The Association also praised Lt. Governor Pamela Evette for her strong leadership and steadfast advocacy on behalf of the hospitality industry throughout this process.

“I am incredibly appreciative of the input I received from numerous S.C. bar and restaurant owners, as well as the SCRLA, regarding the challenges they were facing with the initial alcohol server training deadline,” said Lt. Governor Pamela Evette. “Because of their outreach, and conversations with both the South Carolina Department of Revenue (SCDOR) and members of the General Assembly, we were able to collaborate and work expeditiously to find a solution. Once again, common sense prevails! Thank you to all parties involved for helping ensure our servers are well trained, which helps lower liability costs and reduce DUI incidents statewide."

“Lt. Governor Evette understood early on the operational realities our members were facing and worked collaboratively to help secure a practical solution,” said OFlaherty. "Her engagement and commitment to South Carolina's hospitality industry made a meaningful difference in achieving this outcome."

The SCRLA now urges Governor Henry McMaster to promptly sign the legislation into law, allowing businesses across the state to move forward with clarity and confidence.

The May 1 deadline extension ensures that hospitality operators can complete the required alcohol server training responsibly and thoroughly. This reinforcement of South Carolina’s commitment to public safety helps maintain a healthy, vibrant industry while keeping the state one of the most business-friendly in the nation.

SCRLA remains committed to working with state leaders, regulators, and stakeholders to support the successful implementation of H. 3430.

The ruling impacts a significant portion of the Administration’s tariff actions and raises questions around timing, potential refunds, and retroactive implications, which stakeholders are continuing to review. In response, President Trump announced new temporary across-the-board tariffs using separate authority under Section 122 of the Trade Act of 1974, initially set at 10% and later signaling an increase to 15%, which can remain in place for up to 150 days. These temporary tariffs include exemptions for certain agricultural goods, USMCA-covered products, and items already subject to Section 232 duties. At the same time, U.S. Trade Representative Jameson Greer announced plans to open new investigations under Section 301 that could lead to additional tariffs, underscoring continued uncertainty around trade policy and the potential impact on existing trade agreements.

We will continue to update our members on the fallout of this landmark ruling as additional information becomes available.

South Carolina’s New Liquor Liability Law: What Changed and What Still Needs Work

By Christian Stegmaier and Molly Flynn

South Carolina’s new liquor liability legislation (Act No. 42, R61, H3430) is the most consequential reform in decades to how our state approaches alcohol-related civil liability. The law, which becomes effective January 1, 2026, reshapes how civil liability is assessed, imposes new training and insurance requirements on permit holders, and introduces clearer obligations under regulatory law.

This was long overdue. But while the new statute brings South Carolina closer to what many other jurisdictions already have in place, it still leaves major gaps in clarity, consistency, and fairness for permit holders and their insurers.

What the Law Changes

1. Joint and Several Liability Reformed

Before this law, bars and restaurants could be on the hook for the full amount of a verdict returned in an alcohol-related lawsuit—even if they were only marginally at fault. This exposure was the product of the doctrine of joint and several liability, as codified by the General Assembly in S.C. Code Ann. § 15-38-15. That risk is now significantly reduced. The new legislation now provides that any defendant found to be less than 50 percent at fault will only be responsible for their allocated share of the damages. This shift in the apportionment rules introduces fairness and proportionality into what has long been a high-risk litigation space for permit holders.

2. Fault Allocation to Non-Defendants

The statute allows juries to allocate fault to individuals who are not named as defendants in the lawsuit. This is akin to Florida’s Fabre defendant doctrine.[1] This includes any alleged tortfeasor who contributed to the harm.

For these parties to be added to the verdict form, the defendant must disclose the intention to do so within 180 days of the commencement of the action. The plaintiff may oppose this addition and the defendant bears the burden of proof that the added tortfeasor’s breach of duty was a proximate cause of the plaintiff’s alleged damages.

As a matter of law, settling tortfeasors (whether or not a party) shall be added to the verdict form.

By separate amendment in this new legislation, if a co-tortfeasor was criminally charged with DUI, the defense may move to have them placed on the verdict form. If granted, and a verdict is returned against both the permit holder and the DUI driver, the permit holder’s liability is capped at 50 percent of actual damages.

3. New Scienter Standard: “Knowingly” Selling Liquor to the Intoxicated

One of the most important but underdiscussed changes is the amendment to Section 61-6-2220, which now prohibits the knowing sale of liquor to intoxicated individuals. This amendment now brings the sale of liquor in line with a similarly worded statute (S.C. Code Ann. § 61-4-580) prohibiting the knowing sale of beer and wine to intoxicated patrons.

Previously, the law barred sales of liquor to intoxicated patrons but left ambiguity as to the required state of mind. The new statute uses the word “knowingly,” signaling that liability requires actual or constructive knowledge.

Under the revised statute, plaintiffs must show that the server or establishment knew, or reasonably should have known, that the patron was intoxicated at the time of service. That standard gives defense counsel a stronger position. However, as has been the historical shortcoming with the beer and wine statute, the liquor statute provides no definition for “knowingly,” no list of indicators, and no safe harbor for permit holders who rely on valid ID and do not observe overt signs of impairment. While this amendment is welcome, the continued vagueness and lack of definition is not.

4. Mandatory Server Training

Beginning in 2026, all servers and managers must complete alcohol training through a Department of Revenue-approved course. The training is offered online and covers topics including visible intoxication, ID checking, and South Carolina alcohol laws. Training certificates are valid for three years and must be kept on premises.

5. Liquor Liability Insurance Requirements

The law requires establishments that serve alcohol after 5:00 p.m. to maintain liquor liability insurance or a general liability policy with a liquor liability endorsement. The minimum aggregate coverage is $1 million.

6. Insurance Discounts for Risk Reduction

Operators can reduce their insurance requirement by taking certain actions, such as:

• Ending alcohol service by midnight (limits reduced up to $250,000)
• Completing server training (limits reduced up to $100,000)
• Keeping alcohol below 40 percent of total sales (limits reduced up to $100,000)
• Using forensic ID scanning (limits reduced up to $100,000)
• Operating as a nonprofit (limits reduced up to $500,000)

Depending on the risk mitigation measures adopted, the required aggregate coverage may be reduced to as low as $300,000.

7. Annual Market Reporting by the Department of Insurance

The statute now mandates that the Department of Insurance produce an annual report on the liquor liability insurance market. This includes the number of policies issued, premiums written, claims closed with payments, reserve data, and insurer profitability.

8. Regulations for Collegiate Sporting Events

The law imposes specific requirements for beer and wine sales at college stadiums. These include training, ID checks, and zone restrictions. The Department of Revenue is charged with crafting a tailored enforcement and revenue structure for these venues by August 31, 2025.

Where the Law Falls Short

1. No Standalone Dram Shop Statute

Most states have a dedicated dram shop statute that clearly defines the cause of action, the threshold for liability, and the available defenses. South Carolina still does not. We continue to rely on common law (such as Hartfield v. Getaway Lounge) and fragmented statutory references to establish the standard of care. Without a unified statute, the standard of care remains unsettled and invites inconsistent application across jurisdictions.

2. Undefined “Knowingly” Standard

While the addition of the word “knowingly” to Section 61-6-2220 is a win for clarity, the law does not explain what that means in practice. Is it actual knowledge? Constructive awareness based on observed behavior? A presumption from continued service? Without guidance, juries are left to guess, and courts will have to sort through it in motion practice. Moreover, the law lacks a safe harbor for permit holders who relied on seemingly valid identification and did not observe signs of impairment.

3. No Direction on Intoxicated Passenger Claims

Many states either bar or limit claims by intoxicated passengers. South Carolina’s law does not address this issue. That omission leaves bars and restaurants exposed to large verdicts from individuals who voluntarily participated in the underlying risk. There is no first party liability in South Carolina; for all intents and purposes, an intoxicated adult passenger is a first party and should be treated as such by our law. This is a missed opportunity to define the legal responsibilities of all parties involved in alcohol-related incidents.

4. No Cap on Non-Economic or Punitive Damages

The law does not set any limits on pain and suffering or punitive damages. In venues where verdicts tend to run high, this keeps the door open for runaway awards, even in cases where liability is marginal. Many states limit damages in regulated industries to maintain predictability and insurability. South Carolina’s silence on this issue is a concern.

5. Server Training May Be Too Superficial

While training is now required (which is a welcome addition to our statutes), it is offered online and needs only to be completed once every three years. There is no requirement for in-person instruction or periodic refreshers. The risk here is that training becomes a check-the-box exercise instead of a genuine risk-reduction tool.

6. Insurance Availability Not Guaranteed

Mandating coverage is only part of the solution. The law does not address whether coverage will be widely available or affordable—especially for smaller operators or those in rural areas. There are no premium caps, risk pools, or rate regulations. In some cases, compliance may prove financially prohibitive.

7. Uncertainty Regarding Immediate Appealability of Adverse Decision Concerning Addition of Parties to Verdict Form

Another procedural shortcoming in the new liquor liability statute is its silence on whether a trial court’s decision to include or exclude a non-party tortfeasor from the verdict form is subject to immediate appeal.

Under South Carolina law, interlocutory appeals are generally disallowed. Absent a final judgment, appellate review is rarely granted unless the trial court’s order affects the mode of trial or impairs a party’s substantial rights. Whether the inclusion—or exclusion—of a party from the verdict form meets this standard remains uncertain.

This ambiguity matters. Fault allocation to a DUI driver, settling tortfeasor, or intoxicated passenger can dramatically shift liability and concordant exposure for a permit holder. If a court excludes such a party despite proper disclosure and proffer, the defendant is effectively forced to trial without the benefit of full apportionment. That missing apportionment may lead to inflated exposure or an unjust result, with no meaningful opportunity to correct the error until after final judgment. The new statute creates a right without clearly protecting an immediate remedy. Future legislative refinement should consider providing either a statutory right of immediate appeal or clear guidance on when such decisions implicate substantial rights sufficient for interlocutory review.

Final Thought

South Carolina’s new liquor liability law corrects a number of long-standing weaknesses in our system. It brings proportionality to liability, requires meaningful insurance coverage, and attempts to improve responsible service. That said, we are still missing key pieces that other states have had in place for years. Until we have a dedicated civil dram shop statute, clear guidance on passenger claims, and guardrails around damages and insurance access, we will continue to litigate from a place of uncertainty.

This framework is a foundation—not a finished product. South Carolina has a real opportunity to get this right if it stays focused on clarity, fairness, and sustainability. This starts during the next legislative session, which begins January 2025.

Link to full legislation: 2025-2026 Bill 3430: Tort Reform and Liquor Liability

About the Authors

Christian Stegmaier is President and Chief Executive Officer of Collins & Lacy, P.C., where he also chairs the firm’s Retail & Hospitality Practice Group. He represents national and regional clients in complex litigation and regulatory matters, with a focus on premises liability, liquor liability, and commercial disputes. He can be reached at cstegmaier@collinsandlacy.com.

Molly Flynn is a shareholder at Collins & Lacy, P.C., practicing in the firm’s Retail & Hospitality and Professional Liability Practice Groups. She is a seasoned litigator representing clients in premises liability, alcohol liability, and other general liability matters across South Carolina. Molly can be reached at mflynn@collinsandlacy.com.

[1] In Florida personal injury cases, a Fabre defendant is a third party who is not directly named in the lawsuit but is still considered potentially liable for the plaintiff's injuries. The term comes from the 1993 Florida Supreme Court case Fabre v. Marin. Essentially, in Florida, a named defendant can argue that a Fabre defendant contributed to the incident and should also be held responsible.

Please consider making an end-of-year donation to help the SCRLA advocacy team. 

Your generous financial support will go towards funding our ongoing advocacy initiatives at the Statehouse and beyond with one example being to modernize our state's outdated alcohol laws and regulations. Donations to any fund can be from personal or business dollars and there is no limit to what you can contribute. There is no obligation to contribute and all contributions are voluntary. 

There are three funds to support:

Legislative Advocacy Fund

The SCRLA's government affairs team aggressively promotes public policy options through direct lobbying and grassroots coordination. Their work benefits all of South Carolina's food service, lodging and tourism industry at the local, state, and national levels. Through our Legislative Action Fund, we promote the election of officials who support our industry and demonstrate awareness and appreciation of the business community.

SCRLA Political Action Committee (PAC) Fund

SCRLA State Political Action Committee Fund support pro-business candidates seeking statewide elected offices.

SC Alcohol Reform Task Force Fund

The SCRLA Alcohol Task Force was created to address the challenges our industry is facing regarding current state law and regulations pertaining to alcohol and to provide recommendations to policy makers of potential solutions in the hope of providing some relief to our membership and our industry.

Please reach out to Hank Davis, Vice President of Governmental Affairs and Community Relations for more information and questions. 

"On behalf of the hospitality industry, our Association is proud to have stood with the South Carolina Chamber of Commerce formally joining the legal action taken to defend the Governor and the Director of the SC Department of Employment and Workforce against litigation challenging the Governor’s decision to stop the payment of certain benefits to unemployed workers. If that lawsuit had not been dismissed, it would have caused a downturn in the significant  progress being made to our State’s economy by forcing the State to pay people not to work. The Plaintiffs’ claims run contrary to the public interest, and our industry and our state’s economy would have been harmed if the injunctive relief requested had been granted."

Dismissal Order issued by the Court of Common Pleas in the Fifth Judicial Circuit against the Plaintiffs’ Lawsuit

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COLUMBIA, S.C. -Governor Henry McMaster released the following statement regarding today’s circuit court decision dismissing a lawsuit challenging the Governor’s decision to terminate South Carolina’s participation in optional federal pandemic-related unemployment-benefit programs and rejecting a request to reinstate the extra benefits:

The Open Carry with Training Act, (R82,H.3094) does not infringe upon a business’s right to prohibit weapons on its premises, and the current concealed carry prohibition signs technically includes “openly carried” weapons as well.  However, the general population may not know or understand that the phrase “No Concealable Weapons” also includes openly-carried weapons, so it could be prudent to add the phrase “No Openly Carried Weapons” as well.

Private businesses can prohibit any weapons, of any kind, on their property, this latest law does not change that.

Below are the sign requirements that are identical to “No Concealed Weapons Allowed” signs.  If a business posts a sign that does not meet the following criteria, precisely - someone could in theory bring their weapon on to the property - without fear of legal ramifications.

All signs must be posted at each entrance into a building where a concealable weapon permit holder is prohibited from carrying a concealable weapon, whether concealed or openly carried, and must be:

• clearly visible from outside the building;
• 8 inches wide by 12 inches tall in size;
• contain the words ‘NO CONCEALABLE WEAPONS ALLOWED’ in black one-inch tall uppercase type at the bottom of the sign and centered between the lateral edges of the sign;
• contain a black silhouette of a handgun inside a circle seven inches in diameter with a diagonal line that runs from the lower left to the upper right at a forty-five degree angle from the horizontal;
• a diameter of a circle; and
• placed not less than 40 inches and not more than 60 inches from the bottom of the building’s entrance door.

To comply with the current requirements, the sign should still include the phrase: “NO

CONCEALABLE WEAPONS ALLOWED,” but it could be helpful to add after that phrase the

following: “NO OPENLY CARRIED WEAPONS ALLOWED.”

Read the SLED guidance on the Open Carry with Training Act.

Today, the White House released state-by-state fact sheets that highlight the urgent need in every state across the country for the investments proposed by President Biden in the American Jobs Plan. The fact sheets highlight the number of bridges and miles of road in each state in poor condition, the percentage of households without access to broadband, the billions of dollars required for water infrastructure, among other infrastructure needs.  

Individual fact sheets for each of the 50 states, the District of Columbia and Puerto Rico are linked below.

These fact sheets are the latest in a series from the White House highlighting the benefits of the American Jobs Plan for communities. Additional issue-based fact sheets will be released in the coming days and weeks. Fact sheets on how the American Jobs Plan Advances Racial Equity and the American Jobs Plan Supports Rural America have been released in recent weeks.

The American Jobs Plan is an investment in America that will create millions of good jobs, rebuild our country’s infrastructure, and position the United States to out-compete China.

Click here to view South Carolina's fact sheet.

Fact Sheets by Issue:
Racial Equity
Rural Communities

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SBA Extends Deferment Period for all COVID-19 EIDL and Other Disaster Loans until 2022

The U.S. Small Business Administration announced extended deferment periods for all disaster loans, including the COVID-19 Economic Injury Disaster Loan (EIDL) program, until 2022.

o    All SBA disaster loans made in calendar year 2020, including COVID-19 EIDL, will have a first payment due date extended from 12-months to 24-months from the date of the note.

o    All SBA disaster loans made in calendar year 2021, including COVID-19 EIDL, will have a first payment due date extended from 12-months to 18-months from the date of the note.

Existing SBA disaster loans approved prior to 2020 in regular servicing status as of March 1, 2020, received an automatic deferment of principal and interest payments through December 31, 2020. This initial deferment period was subsequently extended through March 31, 2021. An additional 12-month deferment of principal and interest payments will be automatically granted to these borrowers. Borrowers will resume their regular payment schedule with the payment immediately preceding March 31, 2022, unless the borrower voluntarily continues to make payments while on deferment. It is important to note that the interest will continue to accrue on the outstanding balance of the loan throughout the duration of the deferment.

COVID-19 EIDL loans are offered at very affordable terms, with a 3.75% interest rate for small businesses and 2.75% interest rate for nonprofit organizations, a 30-year maturity. Interest continues to accrue during the deferment period and borrowers may make full or partial payments if they choose.

In mid-February 2021, SBA reached a milestone in the success of the COVID-19 EIDL program, by approving over $200 billion in emergency funding in low-interest loans, providing working capital funds to small businesses, non-profits and agricultural businesses to survive the severe impacts of this catastrophic and historic period within the entire United States of America and its territories. SBA continues to approve over $500 million each week for the COVID-19 EIDL program.

“The creation of the Restaurant Revitalization Fund will be a catalyst to reviving restaurants and saving jobs across the country,” said Tom Bené, President & CEO of the National Restaurant Association. “Our focus from the beginning of this crisis has been on ensuring that our favorite local restaurants could access the assistance they would need to survive. This fund is a win for the smallest and hardest hit restaurants that have sacrificed and innovated to continue to serve their communities.”

The RRF will create a new federal program for restaurant owners with 20 or fewer locations. Operators can apply for tax-free grants of up to $5 million per location, or up to $10 million for multi-location operations. The grant amount is determined by subtracting 2020 sales from 2019 revenues.

Funds from the grants can be spent on a wider range of expenses than previous relief programs, including mortgages or rent, utilities, supplies, food and beverage inventory, payroll, and operational expenses. Five billion dollars of the fund will be set aside for restaurants with gross receipts under $500,000 and, for the first three weeks of the application period, the Small Business Administration will prioritize awarding grants for women-, veteran-, or socially and economically disadvantaged-owned businesses.

“These grants will inject a much-needed stimulus along the supply chain to begin to balance the economic damage done while restaurants have been struggling,” said Bené. “We are still a long way from full recovery and it’s likely more grant money will be needed to get us there, but today the industry has hope for the future.”  

The National Restaurant Association has led the industry’s response to the pandemic. Working with Congress and both the Trump and Biden Administrations, the Association has ensured that restaurants would have as many tools and supports as possible to survive. That included securing special treatment in the creation, and subsequent improvements to the Paycheck Protection Program, which has provided more than $70 billion in support for restaurants to date; the expansion of the Employee Retention Tax Credit; the extension of the Work Opportunity Tax Credit; and inclusion in the Economic Injury Disaster Loans program.

“From the beginning, we knew that the pandemic would be the worst disaster to ever hit to the restaurant industry,” said Sean Kennedy, Executive Vice President of Public Affairs for the National Restaurant Association. “We created a roadmap for Congress and the Administration to tools that already existed but could work better for restaurants, and the plan for creating crucial new support programs like the RRF. These tools created a framework for restaurants of all types and sizes to survive, and now with the RRF in place, they will be the foundation on which we begin to rebuild.”

Get an overview of the Restaurant Revitalization Fund here.

Urges Congress to Rethink Implementing Raise the Wage Act During Pandemic

February 25, 2021 (Columbia, SC)—Carl Sobocinski, founder of Table 301 Group and National Restaurant Association Liaison for the South Carolina Restaurant and Lodging Association (SCRLA), testified before the Senate Budget Committee today in Washington, D.C.

Click here to watch the Senate Budget Committee Hearing (Carl begins at 1:25:25)

Click here to read Carl's testimony.

Sobocinski, along with members of the SCRLA, do not oppose a common-sense increase in the federal minimum wage; however, they do oppose implementing the “Raise the Wage Act” in the middle of the COVID-19 pandemic.

The legislation calls for a 100% increase in the federal minimum wage over five years, from the current $7.25 to $15, and the elimination of the tip credit. Sobocinski encouraged Senators to rethink the effort to fast track this proposal in a bill targeted at keeping businesses open and people in jobs, rather than spurring closures and layoffs.

According to recent National Restaurant Association data, between March 2020 and

January 2021, restaurant sales were down $255 billion from expected levels. Seventeen percent of restaurants – about 110,000 – are closed permanently or long-term. Alarmingly, the industry is still down 2.5 million jobs from the pre-coronavirus level.

For Sobocinski, paying his employees $15 per hour would be a 33% increase from the $10 per hour he currently pays, in turn raising the cost of payroll expenses, employer taxes, workers compensation insurance, and employee benefits.

Raise the Wage would eliminate a separate tip wage, destroying the very business model that restaurants across the nation rely upon.

Tipping is essential for individuals in the restaurant industry. The tip credit system incentivizes servers to deliver excellent service, enables customers to reward servers for great service, and allows restaurants to keep labor costs in check. Tipped employees typically earn on average between $19-25 per hour of additional take home pay.

Raise the Wage Act is predicted to result in 1.4 million job losses— with a one-in-three chance of that number rising to 2.7 million job losses total.

Restaurants are struggling to survive, dealing not only with the pandemic, but reduced capacity that is testing their ability to remain solvent. Take action to save the tip credit by visiting SaveSCTips.org.

Senators Roger F. Wicker & Kyrsten Sinema & Representatives Earl Blumenauer & Brian Fitzpatrick

ECONOMIC VALUE OF RESTAURANTS

The majority of independent, locally owned restaurants were forced to close their doors and lay off their employees in March 2020 because of the COVID-19 pandemic. Before the pandemic, independent restaurants employed 11 million people nationally, but the impact of shuttered restaurants is felt beyond their direct employees. The food supply chain contributes $1 trillion annually to the U.S. economy in addition to tens of millions of jobs. Farmers, fishermen, truck drivers, and restaurant workers across the nation have felt the impacts of restaurant closures, and the ripple effects have reached every American.

Restaurants have been impacted uniquely by COVID-19. Because social distancing measures and stay-at-home orders reduced demand drastically, restaurants are the top contributor to the increased unemployment rate. In April 2020 alone, 5.5 million restaurant workers lost their jobs, accounting for 27 percent of total job losses in the month. Today, six in 10 restaurants remain closed. One in five restaurant owners subjected to state-mandated dine-in shutdowns said they felt confident they could keep their restaurants running. Operators have been forced to lay off 91 percent of their hourly workforce and 70 percent of salaried employees. More than 100,000 restaurants closed their doors in 2020.

Previous relief efforts, such as the Paycheck Protection Program, provided relief to restaurants, but have not met their specific challenges. Restaurants and their employees need immediate, direct, and more flexible assistance in order to remain open.

THE SOLUTION – THE REAL ECONOMIC SUPPORT THAT ACKNOWLEDGES UNIQUE RESTAURANT ASSISTANCE NEEDED TO SURVIVE (RESTAURANTS) ACT OF 2021

• The Fund would be administered by the Department of the Treasury and be made available to restaurants, food stands, food trucks, food carts, caterers, saloons, inns, taverns, bars, lounges, brewpubs, tasting rooms, taprooms, licensed facilities or the premises of a beverage alcohol producer where the public may taste, sample or purchase products, or other similar places of business in which the public or patrons assemble for the primary purpose of being served food or drink that are part of a group of restaurants of 20 or less.
• The grant would be available to cover any eligible expenses incurred from February 15, 2020 and ending on the date that is eight months after the date of the enactment of this Act. The award calculation would be based off of annual revenue losses from 2019 and 2020 rather than quarterly.
• If a food service or drinking establishment has already received a grant or loan under the Paycheck Protection Program (PPP) or Economic Injury Disaster Loan (EIDL) program, the maximum value of the Restaurant Revitalization Grant would be reduced by the amount of PPP or EIDL funds spent.
• Eligible expenses would include: payroll (not including employee compensation exceeding $100,000/year), benefits, mortgage, rent, utilities, maintenance (including construction of outdoor seating), supplies (including protective equipment and cleaning materials), food, operational expenses, paid sick leave, debt obligations to suppliers, and any other expenses deemed essential by the Secretary of the Treasury;
• The maximum grant value would not exceed $10,000,000.
• Grant eligibility would be provided for new restaurants that opened after January 1, 2020.
• Paid sick leave would be provided as an eligible expense for employees, as well as a bonus amount to cover the cost of voluntarily providing 10 days of sick leave to employees.
• In the event of an accidental/inaccurate overpayment from Treasury based on end-of-year revenue calculations by the restaurant, the grant would be converted to a loan with a 10-year term at one percent interest.
• In the event of fraud, the penalties would be the same for any false statements for other federal grant and loan programs. The bill provides the Treasury the discretion to help reduce waste, fraud, and abuse.
• The Department of the Treasury would be obligated to report who receives loans as well as demographic information about the recipients.
• Restaurants would be allowed to use both the Employee Retention Tax Credit and the RESTAURANTS Act grant program, so long as they are not used for the same expenses.
• $300 million would be appropriated for the purpose of staffing and administrative expenses for administering Restaurant Revitalization Grants. $60 million would be set aside specifically to be used on outreach to traditionally marginalized and underrepresented communities (with a focus on women, minority-owned, and veteran operated restaurants), including the creation of a resource center targeted toward these communities.

“The unified RESTAURANTS Act of 2021 is a light at the end of a long, dark winter for independent, chain, and franchise restaurants that have been most impacted by the pandemic. While many other industries have started to recover, the restaurant industry finished last year in a double-dip recession, and with 2.5 million fewer jobs.

“The bill introduced today finally reflects the unified view that all small restaurants should have access to relief—regardless of whether they are an independent or a franchise of a regional chain."

In a statement issued by the sponsors of the RESTAURANTS Act, Tom Bené, president & CEO of the Association, added, “The RESTAURANTS Act of 2021 places independent, chain, and franchise restaurants on a path to economic survival. In an era when agreement in Congress is rare, we appreciate the strong bipartisan leadership from Senators Roger Wicker and Kyrsten Sinema and Representatives Earl Blumenauer and Brian Fitzpatrick. Our members desperately need this legislation, and we look forward to working together with Congress as we continue our efforts to advance the recovery of the entire restaurant industry.”

The $120 billion revitalization fund would allow restaurant owners to apply for grants to cover eligible expenses retroactively back to Feb. 15, 2020, and up to 8 months after the legislation is signed into law.

Read Kennedy’s full statement.

After a long night/morning, the Senate just concluded its “vote-a-rama” on the budget resolution.  Rather than setting policy, vote-a-rama largely consists of symbolic messaging votes. While typically non-binding, they can shed light on Senators’ positions on key policy issues, or attempt to place them on the record in support of a position or approach, which can be highlighted subsequently if they deviate.  While there are numerous votes that took place, following are some of particular interest to restaurants:

• RESTAURANTS Act – The Senate passed, 90-10, Senators Roger Wicker (R-MO) and Kyrsten Sinema’s (D-AZ) amendment calling for the creation of a grant fund for food service and drinking establishments affected by the COVID-19 Pandemic.  The strong vote reflected the Senate’s interest in providing targeted grant relief for our industry.  We worked closely with the Senators on the amendment and in garnering support for its passage.  Additionally, we have collaborated with the Senators and Representatives Earl Blumenauer (D-OR) and Brian Fitzpatrick (R-PA) on a unified Senate/House RESTAURANTS Act, which we anticipate being introduced later today in the respective chambers.

• Minimum Wage – Senator Joni Ernst (R-IA) – Ernst sought a vote on her amendment to prevent an increase in the minimum wage to $15/hr. during a pandemic.  She spoke about restaurants, child care, and others, in the process, and how a one size fits all wage is the wrong approach, because the wage for NY and CA may not work for states like hers.  Budget Committee Chair Bernie Sanders (D-VT) responded about the need to increase the existing “starvation wage,” and highlighted that the minimum wage hasn’t risen since 2007.  He stressed that he will do everything in his power to put the Raise the Wage Act into a reconciliation bill.  Then, in a surprising twist, he stated that because his bill wouldn’t raise wages to $15/hr. during the pandemic, it would phase them in over five years, he supported her amendment…It was voice voted and passed.

• Minimum Wage – Tip Credit – Republican amendments were filed, that were targeted at messaging opposition to eliminating the tip credit.  While we worked diligently to secure commitments from Democratic Senators to support such an amendment, if voted upon, it ultimately wasn’t. While a vote didn’t occur, the exercise had extensive value, further elevating the issue with key Democratic Senators, who will be pivoting to the conversation in the context of a budget reconciliation bill.

• No-Tax Increases on Small Businesses During a Pandemic – All 100 Senators supported an amendment by Senators Marco Rubio (R-FL) and Tim Scott (R-SC) opposing tax increases on small businesses during a pandemic.  Republicans are messaging that this should dissuade Democrats from using budget gimmicks – like eliminating tax deductions for businesses that pay lower wage rates – in an attempt to overcome procedural hurdles in attaching a minimum wage increase to a budget reconciliation bill.

• We will continue to work aggressively on the minimum wage/tip wage issues and keep you informed as things progress.  Attached are issue briefs and background in opposition to the Raise the Wage Act and the elimination of the tip credit.

• Cortez Masto – Hospitality and Jobs Recovery – Cortez Masto’s amendment – to expand support for Americans in relation to their employment in hospitality – passed by a voice vote.  This vote was geared toward increasing support for her Hospitality and Commerce Job Recovery Act.

As a reminder, the budget resolution votes are typically non-binding, so they should not be interpreted as setting or precluding certain policies.  But, as mentioned above, in some instances they can help frame future conversations on policies and on what should/shouldn’t be included into a reconciliation package or future pieces of legislation.

The Senate passed the budget resolution, along party lines, advancing Senate Democrats’ drive toward assembling a budget reconciliation bill.

Protecting the Right to Organize Act (PRO Act):

Senate HELP Committee Chair Patty Murray (D-WA) and House Education and Labor Committee Chair Bobby Scott (D-VA) have reintroduced the PRO Act.  The legislation contains over a dozen provisions that would substantially alter settled federal labor law and cause further damage to the economy struggling to recover from the pandemic.  Together with our colleagues in our Coalition for a Democratic Workplace (CDW), we aggressively opposed the legislation in the last Congress, and will continue in this Congressional session.  Attached is our press statement and CDW opposition letter. 

Senate HELP Committee Hearing on the Nomination of Marty Walsh for Secretary of Labor:

The Senate HELP Committee held a hearing on Marty Walsh’s nomination to serve as Secretary of Labor.  The hearing was balanced, largely avoiding politically charged opposition and fireworks.  As expected, Walsh did not offer specific policy prescriptions and portrayed himself as a “consensus builder” who wants to hear from all sides of the regulated community.  He was asked direct questions on some of our key priorities, including the $15 minimum wage; elimination of the tip credit; and the PRO Act. 

Senator Roger Marshall (R-KS) noted that costs of living across the country vary greatly and that a $7.25/hr. minimum wage, in his hometown, would be equivalent to a $16/hr. minimum wage in Boston, adding that a $15/hr. federal minimum wage would kill jobs in Kansas. Mayor Walsh replied that he supports a $15/hr. minimum wage, but acknowledges that “there will need to be many conversations in Congress before it is passed, including the best way to institute it.”

Regarding the tip wage, Senator Mike Braun (R-IN) referred to restaurants as the most devastated industry during the pandemic and criticized Democratic proposals to take away tips favored by servers and bartenders.  He suggested that the tip credit allows these workers to “exceed the minimum wage.”  Walsh replied that he has talked to many Boston restaurant owners, since the pandemic, “would like to continue the conversation on tips,” and wants to “talk more offline on working toward a resolution.” 

Senator Tim Scott passionately criticized the PRO Act, asserting that it would be devastating for America’s workforce, asking Walsh to talk to both sides of the aisle before moving forward with the PRO Act.  Walsh committed to do so. Senator Scott also criticized raising the minimum wage to $15/hr. given regional economic disparities. 

Chair Patty Murray (D-WA) asked Mayor Walsh for his priorities in respect to job training and apprenticeships. Mayor Walsh responded that we need to continue to invest in recovery and that President Biden’s Build Back Better plan will require significant investment in workforce development. Mayor Walsh also said that we need to look at ways to return older Americans back to the workforce.

U.S. Department of Labor (DOL) to Delay Trump Tip Credit Final Rule:

As anticipated, the DOL is seeking to push back the effective date for the tip credit rule – which had an original effective date of  March 1, 2020 – to April 30, 2020 and is seeking public comment on the delay.  In a notice to be filed in the Federal Register, set to be published on Friday, the DOL's Wage and Hour Division contended that the proposed delay of the Tip Regulations under the Fair Labor Standards Act is necessary so the Administration can review the regulations. The Association will file comments opposing the delay. 

Alex Gangitano January 26, 2021

Business groups are preparing for a lobbying fight after Democrats in both chambers reintroduced a bill Tuesday to raise the federal minimum wage to $15 by 2025.

The Raise the Wage Act, spearheaded by incoming Senate Budget Committee Chairman Bernie Sanders (I-Vt.), would raise the minimum wage to more than double the current rate, which is $7.25 an hour.

The restaurant industry quickly pushed back on the legislation, saying it creates an impossible challenge for restaurants, which have already been hit hard by the coronavirus pandemic.

“Far too many restaurants will respond by laying off even more workers or closing their doors for good. As the pandemic has highlighted, the economic realities of each state are very different,” said Sean Kennedy, National Restaurant Association executive vice president of public affairs.

Kennedy added, “A nationwide increase in the minimum wage will create insurmountable costs for many operators in states where restaurant jobs are most needed for recovery.”

The U.S. Chamber of Commerce also has concerns over the economic damage a $15 minimum wage could do in the middle of “this K-shaped recovery, where so many of the jobs that have been lost are those jobs that tend to be on the lower end of the wage scale,” said Neil Bradley, chief policy officer at the Chamber.

“We remain open to sitting down with the new administration, and Democrats and Republicans to talk about a more sensible approach on minimum wage. But I can guarantee you there's nothing sensible about $15,” Bradley said.

The Employment Policies Institute, a fiscally conservative think tank, released a study Tuesday that estimates that raising the federal minimum wage to $15 an hour would result in 2 million jobs lost.

The institute estimates the plan would cost employers more than $99 billion.

“This will probably be the most serious fight on the minimum wage since the mid to late 2000s when it went up the last time. I think the pressure on the left is probably as strong as it's been in a long time to do something on this,” said Michael Saltsman, the institute’s managing director.

Opponents to the legislation stressed that the coronavirus pandemic and resulting economic recovery are the wrong time to force employers who are already struggling to keep staff on payroll to pay higher wages.

“I think it’s particularly irresponsible right now given what restaurants have been going through,” Saltsman said.

The franchise industry, represented by the International Franchise Association (IFA), is also anxious about the impact on struggling small businesses.

“We do have concerns about more than doubling the federal minimum wage particularly so quickly, and even more, concerns about doing it while small businesses are still dealing with the pandemic and coming out of this economic downturn,” said Matthew Haller, IFA senior vice president of government relations and public affairs.

Haller said IFA is open to a conversation about what the appropriate federal minimum wage is.

"The real issue is that doubling the minimum wage will be more harmful to the people it's intended to help in places where the cost of living is lower,” he said. “$15 makes sense in New York City or San Francisco, but it doesn’t work in Wheeling, West Virginia.”

The bill would also phase out the tipped minimum wage for restaurant service workers, a proposal President Biden has made.

The National Restaurant Association argues that eliminating the tip credit would cut the wages of restaurant workers.

“The elimination of the tip credit will cut the take-home wages of thousands of tipped employees who make far above the proposed minimum hourly wage. These skilled hospitality professionals generally earn between $19-25 dollars per hour and have made clear many times before that they support a tipped minimum wage,” Kennedy said.

Massive restaurant chains are already voicing concerns about the future of their companies under the legislation. TGI Fridays CEO Ray Blanchette told CNBC on Friday that eliminating the tipped minimum wage would result in fewer hours for waitstaff and higher menu prices.

The Restaurant Workers of America, a group formed in 2017, will lobby Congress to keep the tip credit.

“The tip credit is a non-partisan issue, it is common sense pragmatic legislation. Our organization is strictly designed and hopes to preserve the tip credit as we know it,” said Joshua Chaisson, co-founder and vice president of Restaurant Workers of America.

They plan on starting a “fervent” email and phone campaign to contact lawmakers about their opposition to the provision.

“We have to share with lawmakers and educate lawmakers on why it's important to lift up their workers now and why workers have a vastly different voice from ownership and associations of ownerships,” Chaisson said.

There is some skepticism on K Street whether the bill can get passed. It is expected to face pushback from Republican lawmakers as well as moderate Democrats.

A similar effort failed in 2013 when then-President Obama proposed raising the federal minimum wage to $9 from $7.25 by the end of 2015, but progressives called for a $10.10 minimum wage under three years.

One K Street source noted that the push for a $15 minimum wage has been an effective "political and messaging weapon" but questioned whether Democratic lawmakers overall wanted such a hike.

Still, labor unions have been vocal in the fight. The Service Employees International Union's Fight for $15 campaign has led to $68 billion in raises for 22 million workers since it launched in 2012, according to the union.

Raising the minimum wage is also expected to increase income for nearly 32 million Americans, with larger effects for Black, Latino and female workers, according to the left-leaning Economic Policy Institute.

©2021 Capitol Hill Publishing Corp., A Subsidiary of News Communications, Inc. All Rights Reserved.

WHAT THE COVID RELIEF BILL MEANS FOR SOUTH CAROLINA'S HOSPITALITY INDUSTRY

The South Carolina Restaurant and Lodging Association (SCRLA) respectfully requests Governor McMaster to lift the 11:00 p.m. Last Call Order based on a recent report from New York State's contact tracing data. The data shows nearly 74% of COVID cases are the result of transmission in households or social gatherings, while restaurants only account for 1.4%.

We continue to support aggressive steps to protect our state’s public health, but there is an unfounded impression that restaurants are part of the problem. Restaurants provide a safe environment, adhering to Restaurant Reopening Guidelines set forth by AccelerateSC and public health officials. Our industry is suffering as a result of inconsistent, restrictive mandates— which includes Governor McMaster’s 11:00 p.m. Last Call Order.

Governor McMaster can make a difference by restoring full operating hours for restaurants and hotels to serve guests safely. 

The hospitality industry values guest, staff and vendor safety; there is no conclusive data showing that restaurants cannot operate safely when exercising DHEC guidance and CDC protocols.

Taking this new compelling data into consideration, we beseech Governor McMaster and DHEC Acting Director Marshall Taylor to implement the same level of thorough contact tracing protocols. Our livelihoods are at stake, as Leisure and Hospitality has been the hardest hit industry, with current employment levels being at 83% of what they were in February.

The SCRLA in partnership with the National Restaurant Association and other state restaurant associations recently conducted a restaurant business conditions survey with 6,000 restaurant operators across the nation. The survey found:

• Consumer spending in South Carolina restaurants remained well below normal levels in October. 81% of South Carolina restaurant operators say their total dollar sales volume in October was lower than it was in October 2019.
• 65% of South Carolina restaurant operators do not expect business conditions to improve in the coming months.
• Even though sales were significantly lower for most restaurants, it doesn’t mean their costs also fell proportionally. 63% of South Carolina operators say their restaurant’s total labor costs (as a percent of sales) are higher than they were prior to the COVID-19 outbreak.
• 18% of South Carolina operators say they are considering temporarily closing their restaurant until the COVID-19 pandemic passes.
• Only 8% of operators expect their staffing levels will rise during the next 3 months.

New Year’s Eve for hospitality is the equivalent to Black Friday for retail. Don’t let the South Carolina hospitality industry continue to suffer by denying them one of the most profitable nights of the year. We implore Governor McMaster to lift the 11:00 p.m. Last Call Order prior to New Year’s Eve so our hospitality industry may have a glimmer of hope going into 2021.