The California state legislature passed the FAST Act (AB 257) on Aug. 30, which would establish a council to regulate wages and working conditions for employees of fast food restaurants with more than 100 locations.
If signed by Gov. Gavin Newsom, the will would create a council of 10 members pulled from representatives of state agencies, fast food franchisors and workers, fast food worker advocates and the Governor’s Office of Business and Economic Development. Further, the bill allows California cities and counties with more than 200,000 people to create their own local councils that would make recommendations to the state council.
The board would have the power to raise the minimum wage for covered restaurants to as much as $22 an hour – an increase from California’s current minimum wage of $15.50. However, the final version of the law prohibits the council from issuing new rules until the state’s Director of Industrial Relations receives a petition approving the creation of the council signed by at least 10,000 California fast food workers.
“It’s rare that a state legislature passes a bill that would hurt small businesses, their employees, and their customers, but California’s FAST Act does just that,” said Michelle Korsmo, president and CEO of the National Restaurant Association. “Even the Governor’s own Department of Finance said AB 257 would increase costs. This comes at a time when inflation is at record highs and families are struggling every month.
“For restaurant operators, the FAST Act threatens businesses already contending with a 16 percent increase in wholesale food prices and ongoing supply chain challenges,” she continued. “In fact, 45 percent of California’s restaurant operators report that their business conditions are worse today than they were three months ago.
“Nine in 10 restaurants are small businesses that employ fewer than 50 people,” Korsmo said. “This bill sends a clear message that the state legislature doesn’t understand the importance of these employees to the small business owners operating not just franchise restaurants, but also bakeries, juice bars, pizzerias, delis, salad shops and so many other quick service establishments on which Californians rely. It’s these local businesses that provide people first jobs, career opportunities and support their communities. The FAST Act isn’t going to achieve its objective of providing a better environment for the workforce, it’s going to force the outcomes our communities don’t want to see.”