A landmark law set to take effect faces a legal roadblock
By Brian Kabateck
They greet you at the counter, flip your burgers, blend your shakes; they fill submarine sandwiches and tacos, pack cheerful kids’ meals, they pass your piping hot morning coffee through a window straight into your car.
They also work long, hard hours for low pay, scant benefits, and minimal job security and suffer the harmful effects of regulatory non-compliance on the part of their employers. Their predicament has been exacerbated and exposed by the pandemic and steep inflation.
But in 2023, half a million non-unionized fast food workers in California—primarily women and people of color—are getting new protections.
In September 2022, Governor Gavin Newsom signed a new law bill to empower fast food workers and defend their rights. They are known as the FAST Recovery Act, short for Fast Food Accountability and Standards Recovery Act, California Assembly Bill 257, which was set to take effect January 1. It calls for establishing a ten-member Fast Food Council that will have broad powers to govern the treatment of workers in the fast food industry and curtail exploitation.
The FAST Recovery Act defines a fast food establishment as any restaurant that is part of a chain of 100 or more locations or franchises that share key branding elements (decor, packaging, etc.), marketing, products, and services.
The groundbreaking Fast Food Council, composed of government appointees and representatives from both the business side (employer/industry) and the labor side (advocates for workers) serving four-year terms, will have the mandate to set rules and standards for wages, hours, health and safety, and other working conditions. The council is also designed “to ensure and effect interagency coordination and prompt agency responses regarding issues” of employee welfare; the act bans employers from taking discriminatory or retaliatory action when an employee comes forward regarding violations. The council can significantly raise the minimum wage for fast food workers over the next year to as much as $22/hour (from $15) by December 31, 2023.
Labor advocates hail the law as a vital step in the right direction. As the Washington Post reported, Mary Kay Henry, president of the Service Employees International Union, called it “a watershed moment in the history of the labor movement.”
However, the law is already getting severe pushback. Numerous business groups, including the U.S. Chamber of Commerce, oppose the idea of a council that upends the power structure in the industry—they want the legislation overturned. They fear other states will follow California’s example, giving an unelected counsel such broad power and inflaming the already intense national battle over workers’ rights. Opponents also warn that the new council will confuse with rules set by other regulatory bodies, such as Cal/OSHA. That wage hikes and other measures could increase the cost of doing business so much it will “force employers to reduce their worker count and invest in automation technology,” according to The Regulatory Review.
On December 29, just three days before the law would have taken effect, the Save Local Restaurants coalition, made up of businesses and restaurant trade groups, sued to stop its enactment, the Los Angeles Times reports. The coalition is trying to block the legislation and ask California voters to approve or reject it in a November 2024 referendum. The referendum will likely make it to the ballot after gathering well above the required minimum signatures (as yet unverified). On December 30, 2022, a Sacramento County Superior Court judge issued a temporary restraining order blocking the state from implementing the law.
However, Governor Newsom’s office issued a statement reiterating his commitment to enforcing AB 257 as of January 1. “The … act gives fast-food workers a seat at the table to set fair wages and important health and safety standards,” Erin Mellon, a spokesperson for the Governor, told the LA Times. “The state has an obligation to implement this important law unless and until [a referendum] occurs.”
The attorneys at Kabateck LLP support the rights of service industry workers. We are experts in employment law and have experience in disputes with employers over working conditions—we’re here to help.