A California bill that aims to improve and standardize working conditions for fast-food workers will head to Governor Gavin Newsom’s office after winning passage in the state Senate and Assembly on Monday following the objections from commercial interests, who say it unfairly targets the fast-food industry and will drive up food prices.
The centerpiece of Assembly Bill 257, dubbed the Fast Food Restaurant Act, is the creation of a state fast food restaurant board with the power to set standards for wages, hours of work and conditions. The council would reserve seats for business and labor representatives.
“We seek to give workers a voice at work, and for workers in the fast food industry, who will continue to try to organize, it is difficult,” said former lawmaker Lorena Gonzalez, the original author of the bill, who is no longer in the Assembly. “They never had a voice at work and the traditional organization didn’t work.”
The bill missed Assembly by two votes in the previous legislative session, but passed in January of this year after being reintroduced by Assemblyman Chris Holden (D-Pasadena). He returned to the Assembly on Monday for a new vote due to several amendments made in the Senate to allay the concerns of some lawmakers.
Newsom has not taken a position on the bill, but his Department of Finance released an analysis in June opposing the measure, saying it would create “significant ongoing costs” to the Department of Industrial Relations and a ” fragmented regulatory and legal environment” for employers. .
A major change was the removal of a joint liability clause that would have made a franchisor liable for its franchisees’ labor law violations, a provision that opponents of the measure say would significantly discourage franchising in the state.
Another reduces the size of the board and the number of seats allocated to state regulators, originally seven of the 13 seats. The revised 10-person council includes four seats held by representatives of fast food franchisers and franchisees and four seats held by representatives and advocates of fast food workers.
The final two seats are reserved for representatives of the Department of Industrial Relations and the Governor’s Office of Business and Economic Development, both of whom would be appointed by the governor.
“What we have is a board that gives voice, that’s what the labor code is,” said Sen. Bob Hertzberg (D-Van Nuys), holding a copy of the labor code, before the vote. “I think a fair balance has been struck.”
The bill establishes that lawmakers will have enough time to review and potentially block any standards set by the council, and the council has a sunset in six years, allowing lawmakers to assess its effectiveness.
The new version of the bill also prevents the minimum wage from rising above $22 an hour in 2023.
The legislation was strongly opposed by the California Restaurant Assn., International Franchise Assn. and the California Chamber of Commerce, who together sponsored the Stop AB 257 campaign.
The US Black Chambers, the National Asian/Pacific Islander Chamber of Commerce and Entrepreneurship and the National LGBT Chamber of Commerce sent a joint letter to lawmakers on Monday urging them to vote no on the bill.
Jot Condie, president of the CRA, said the amendments do not change the fact that the legislation still creates a council with regulatory power that bypasses the Legislative Assembly.
“You can move the council, but that doesn’t change the fact that they’re handing over the keys to a council that’s not accountable to do fundamental work,” Condie said. “Fundamental issues of workplace politics should be considered and addressed by elected officials.”
Condie pointed to California labor enforcement data that shows fast food restaurants account for just 1.6% of labor violations across all industries and that the industry is one of the “top compliance performance.
If the council chooses to raise the minimum wage to $22 an hour, it would lead to a 20% increase in food prices in restaurants, say opponents of the bill, citing a report by the Center for Economic Forecasting and Development from UC Riverside School of Business.
Blair Salisbury, owner of an El Cholo in Pasadena and former president of the Los Angeles chapter of the ARC, said he planned to franchise a local restaurant called Daddy’s Chicken Shack when AB 257 gave him a break .
“It just gave me really cold feet,” he said. As part of the 20-restaurant deal he made, he will open a restaurant himself and have to find 19 other people to open franchises in five years. He believes AB 257 will make finding franchisees more difficult.
Salisbury also believes minimum wage increases will lead to restaurants reducing their workforce and finding ways to automate their operations where possible. At his restaurant, Salisbury had to cut three prep cooks due to minimum wage increases, he said.
Ahead of the vote, Republican lawmakers vehemently criticized the legislation, saying it failed to address the enforcement of existing labor laws and gave “unchecked authority to an unelected board.”
Fast food workers across California have rallied in support of the bill, especially in light of the COVID-19 pandemic, which has given service industry workers new frustration and visibility as that they continue to operate under grueling, sometimes dangerous conditions.
A study by UCLA and UC Berkeley work centers found that nearly two-thirds of fast food workers have been victims of wage theft and more than half have faced risk for occupational health and safety. Of workers who raised their concerns with their employer, about a third said their employer did nothing to address the issue, while 25% experienced retaliation, according to the study.
“We’re not trying to tell these franchisees and companies how to run their business. We just want them to listen to some of our ideas, that’s all,” said Anneisha Williams, who works part-time at a Jack in the Box on Slauson and Arlington Avenues in South Los Angeles.
Williams, 37, filed a labor complaint in June alleging Jack in the Box failed to pay her properly when she had to stay home to care for her son, who had to be quarantined due to exposure to COVID during the periods of January and February of this year, according to the complaint.
Williams said when she asked her store manager about COVID pay, he told her she wasn’t entitled to it because she herself hadn’t tested positive.
“We shouldn’t have to struggle so much,” Williams said. “We want to be treated as if we were real human beings.”
Sectoral bargaining, in which unions bargain for workers across an entire industry, is common in Europe. Although not exactly the same, the council established by AB 257 would be the first such sector council in the United States, as far as Gonzalez knows.
David Madland, a senior fellow at the Center for American Progress, a progressive think tank, called the legislation “the most important pro-worker bill in decades” at a post-vote news conference.
The industry-wide approach “empowers workers, creates a forum for all stakeholders to come together and raises standards across the industry,” he said.
Mary Kay Henry, president of the Service Employees International Union, said she was confident Newsom would sign the bill.
Gonzalez said she believes the amendments addressed many of the concerns of lawmakers and business interests about the initial version of the bill.
“Now is it just that you think workers should have a voice at the table, raise issues and set standards in the workplace?” González said. “That’s all.”