California Enacts Landmark Fast Food Law
Author: Michael Cardman, XpertHR Senior Legal Editor
September 6, 2022
Already among the most employee-friendly states, California just became even more friendly for fast-food workers.
The Fast Food Accountability and Standards Recovery Act (FAST Recovery Act) signed into law yesterday establishes a new 10-member Fast Food Council and vests it with the authority to set employment standards for fast food restaurants.
"California is committed to ensuring that the men and women who have helped build our world-class economy are able to share in the state's prosperity," Gov. Gavin Newsom said. "Today's action gives hardworking fast-food workers a stronger voice and seat at the table to set fair wages and critical health and safety standards across the industry."
The Council's Mission
The Council is broadly charged with reviewing fast food health, safety and employment standards at least once every three years and then recommending regulations that are "reasonably necessary or appropriate to protect and ensure the welfare" of fast food restaurant workers.
In particular, the Council is tasked with looking at:
- Wages - The Council has authority to set a minimum wage of up to $22.00 per hour for fast food restaurant employees or for a "relevant subgroup" of fast food employees in 2023. Starting in 2024, and every year thereafter, this minimum wage will be increased by 3.5% or by the rate of inflation, whichever is less. The Council also is charged with regulating maximum hours of work.
- Working conditions - The Council may regulate conditions affecting fast food restaurant employees' health and safety, security in the workplace, the right to take time off work for protected purposes, and the right to be free from discrimination and harassment in the workplace. However, the Council is prohibited from creating new paid time off benefits (such as paid sick leave or paid vacation) or any new predictable scheduling requirements.
- Training - Although training is explicitly part of the Council's remit, the law provides no further details about what sort of training is expected.
The Council's recommended regulations must be submitted to the state legislature by January 15 and would take effect the following October 15 unless the legislature enacts legislation preventing them from taking effect.
The Council can issue regulations with a six-vote majority. With four members representing fast food employers and six members representing fast food employees or the state government, the Council is expected to issue employee-friendly regulations.
The law applies only to fast food restaurants that are part of a chain - meaning, a set of 100 or more restaurants nationwide that share a common brand, or that are characterized by standardized options for decor, marketing, packaging, products and services.
A fast food restaurant is defined as an establishment that primarily provides food or beverages:
- For immediate consumption either on or off the premises;
- To customers who order or select items and pay before eating;
- With items prepared in advance, including items that may be prepared in bulk and kept hot, or with items prepared or heated quickly; and
- With limited or no table service (table service does not include orders placed by a customer on an electronic device).
Tip of the Spear?
Not surprisingly, industry groups oppose the law.
The National Restaurant Association predicted California may push to expand the law to include full-service chain restaurants and independent restaurants.
It also predicted that other states - including Illinois, New York, Oregon and Washington - will try to enact similar legislation.
The US Chamber of Commerce said that labor organizing is challenging in the fast-food sector because individual restaurants owned and operated by franchisees are legally separate corporations. It claims the law represents an effort to circumvent the labor-organizing process with "diktats from bureaucrats."