California Fast Food Wages Would Be Set by Government Under Bill Passed by State Legislature

California's Legislature passed a bill Monday to create a government panel that would set wages for an estimated half-million fast food workers in the state

• The bill, known as the Fast Act, would establish a panel with members appointed by the governor and legislative leaders composed of workers, union representatives, employers and business advocates.
• They would set hourly wages of up to $22 and can increase them annually by the same rate as the consumer-price index.

The final version of the Fast Act passed both houses of the Democratic-controlled state Legislature on Monday

• In both the Assembly and the Senate, all of the "yes" votes came from Democrats and every Republican who voted opposed the bill.
• Democratic Gov. Gavin Newsom has until Sept. 30 to decide whether to sign or veto the bill

Proponents of the bill argue that tighter regulations are needed to protect fast food workers, who are overwhelmingly Black or Latino and who they say experience unpaid overtime and other labor violations.

• Labor unions backing the measure have long struggled to organize fastfood workers, in part because the industry's franchise model means there are so many different employers.

Proponents said the bill is still a significant step forward.

• Lorena Gonzalez Fletcher, a former Democratic legislator who introduced the bill when she was in the Assembly, said it moves California closer to a labor model used in Europe where unions negotiate for wages and work conditions in an entire sector, rather than company-by-company.

The bill covers fast food restaurants that are part of a chain, that have limited or no table service, and where customers order their food and pay before eating.

• The chain must have 100 or more locations nationally, up from 30 in a previous bill version
• California accounts for around 14% of total U.S. restaurant sales

Potential Implications

• Investors have begun to ask about the act's potential implications for restaurant chains at a time when companies are struggling with high food and labor costs.
• Disclosures for lobbying spending since July 1 aren't due until later this year, but industry advocacy against the bill has ramped up considerably during that time

https://www.wsj.com/articles/california-fast-food-wages-would-be-set-by-government-under-bill-passed-by-state-senate-11661811509