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New California law to let labor council set pay, working conditions for fast-food restaurants

California Gov. Gavin Newsom on Labor Day signed a new law that would create a first-in-the-nation labor council to set wages and working standards for fast food workers.

Under the new law, known as the Fast Food Accountability and Standards Recovery Act, a fast food council consisting of employers, employees and government officials would negotiate over working conditions for an industry that largely is not represented by unions.

The council’s regulations would apply to any chain restaurant with at least 100 location in the United States. It will also cap minimum wages at $22 an hour in 2023.

“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,” Newsom said in a press release. “I’m proud to sign this legislation on Labor Day when we pay tribute to the workers who keep our state running as we build a stronger, more inclusive economy for all Californians.”

The law, introduced by Assemblyman Chris Holden, D-Pasadena, was propelled by a union movement to increase pay. Fast food workers held demonstrations and walkouts to advocate for the bill over the summer.

“Today, fast food workers earned a voice at the table — across from massive corporations —to help improve their lives & workplaces. Thank you Gavin Newsom for signing AB 257 which will create the first fast food council in the country. All our essential workers deserve more!” California Labor Federation President Lorena Gonzalez wrote on Twitter.

The labor organization Service Employees International Union has worked for more than a decade to organize in fast food restaurants, including leading campaigns to raise the state’s minimum wage. SEIU advocated for the new fast food bill, too, and celebrated Newsom signing the law.

“If you see me crying today it’s (because) I’m completely filled with joy. 550k+ fast food workers finally got their seat at the table to set their working conditions,” SEIU California Executive Director Tia Orr wrote on Twitter.

Fast food companies and owners of franchises, as well as the California Restaurant Association and the International Franchise Association opposed the law. They argue that California already has strict labor laws and their industry complies with them. They also contend the bill will raise costs for consumers.

International Franchise Association President Matthew Haller in a written statement said many fast food franchise owners are unsure how they’ll keep up with expenses after the labor council takes effect.

“By signing this bill, Gov. Newsom is siding with special interests rather than the people and small businesses of California,” International Franchise Association President and CEO Matthew Haller said in a written statement. “This bill has been built on a lie, and now small business owners, their employees, and their customers will have to pay the price. This bill is a fork in the eye to franchise owners and customers at a time when it hurts most.”

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