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Low-Wage Sizzle: Outback Steakhouse PAC

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Political money is a featured dish on the spending menu of Tampa-based Outback Steakhouse restaurants. The chain was controlled by Bain Capital until last month, when its parent, Bloomin’ Brands, went public in an Initial Public Offering. Bain and its investors stand to earn an estimated 88 percent return on their investment in the company.

Almost everyone now knows Bain’s critical role in building Mitt Romney’s wealth as a leading light of the 1 percent. And, Ann and Mitt Romney are investors in the particular Bain fund that bought and then sold Bloomin’ Brands.

But few noticed that Outback’s Political Action Committee (OSI PAC, also known as OSI Restaurant Partners) this year emerged as the restaurant industry’s biggest political donor.  So far in 2012, OSI PAC has given more money to political candidates than the PACs of any of these bigger and better known firms: Coca-Cola, McDonald’s, Pepsi, Taco Bell, KFC, Pizza Hut, or Wendy’s.  Indeed, it’s given more than the National Restaurant Association PAC, which represents 300,000 restaurants nationwide and is labeled a “heavy hitter” by the Center for Responsive Politics.

Source: Center for Responsive Politics.

Over the last decade, OSI PAC has funneled millions of dollars to candidates, referendum campaigns and lobbying efforts.

In Florida earlier this year, OSI championed a move to slash the minimum wage for tipped restaurant employees to $2.13 an hour.  OSI’s actions might have turned the stomachs even of some restaurant magnates.  The company that owns the Olive Garden and Red Lobster chains avoided contributing further to this failed campaign by quitting the  Florida Restaurant and Lodging Association.

Alliances with other PACs are also on the OSI PAC menu. Last year, OSI PAC held a joint fundraiser for Virginia Republican Senate candidate George Allen  with the Citizens United Political Victory Fund, famous for the Supreme Court case gutting political spending limits, and the Koch Industries PAC, funded by the energy magnate Koch brothers. In 2010, Outback Founders and Executives gave $100,000 to Karl Rove’s PAC, American Crossroads.

But don’t just blame Mitt Romney or Bain. OSI PAC dished out healthy servings of 1 percent politics even before Bain took over in 2007. Over the past six election cycles, more than 90 percent of OSI PAC’s federal donations, nearly $3 million, went to Republicans. In the pre-Bain era, a 1998 Mother Jones  investigation reported that multiple “managers” felt coerced to donate to the PAC– including at least one man paid a mere $22,000 per year.

OSI PAC’s war on the minimum wage  also has a long history. When they lost a referendum in Florida in 2004 which raised the state minimum wage, the PAC served up a new approach— backing candidates who would support legislation to exclude restaurant workers from future state increases in the minimum wage.  In concert with other business groups, OSI also helped laws  in Wisconsin and Georgia preventing municipalities from setting the local minimum wage above the state minimum.

And Outback’s anti-union activism goes back much farther. In 1988, the PAC gave $10,000  to California Proposition 226, a referendum aimed at preventing unions from deducting political donations from members’ paychecks. At the same time, Outback was accused of requiring every manager to agree to a donation to the OSI PAC that is automatically deducted from each paycheck.

Outback simply can’t stomach the minimum wage, even where the law requires fair payment of workersBetween 2003 and 2012, restaurants operated by Bloomin’ Brands and its affiliated companies were found to have violated the Fair Labor Standards Act (FLSA) in 31 separate cases investigated by the  U.S. Department of Labor (DOL).

  • These cases included 277 individual violations affecting 251 employees.
  • Bloomin’ restaurants were found by DOL to have underpaid employees by a total of $275,982 while violating minimum wage and overtime laws.
  • In seven cases, DOL investigators found that Bloomin’ restaurants were violating child labor laws.
  • In nine cases, DOL investigators found that Bloomin’ restaurants were repeat violators of FLSA.

Outback may “take great pride in serving the freshest, highest-quality food possible,” but there is something distasteful about the way they campaign against the folks who serve their food.

Stephanie Lane is a researcher at Good Jobs L.A. Her post first appeared on its site and is republished here with permission.

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