CA Gov Gavin Newsom Figures Fast Food Workers Deserve A Break Today (And A $22 Minimum Wage!)
California Gov. Gavin Newsom on Monday signed a new labor law — because Labor Day, you know — that will ensure fast food workers a spot at the table in setting wage, safety, and working condition standards in the state. Hopefully, the table won't be all sticky and covered in fry residue.
The law will create a 10-member "Fast Food Council" that will include equal numbers of members representing workers and the industry (including franchise owners), along with a couple members from state regulatory bodies. A press release from Newsom's office said the council will be responsible for setting minimum standards for
wages, conditions related to health and safety, security in the workplace, the right to take time off from work for protected purposes and protection from discrimination and harassment.
Newsom said in the announcement that California is "committed to ensuring that the men and women who have helped build our world-class economy are able to share in the state’s prosperity." The chair of the council will not, unfortunately, hold the title of Burger King.
Not surprisingly, the Associated Press reports that restaurant owners are less than thrilled, warning that actually having to pay and treat their employees a bit better will drive up prices for consumers.
The AP reports that the law
caps minimum wage increases for fast-food workers at chains with more than 100 restaurants at $22 an hour next year, compared to the statewide minimum of $15.50 an hour, with cost of living increases thereafter.
The law passed on a party line vote in late August, with Republicans opposed to the measure because of course they were. The Republican nominee running against Newsom in this fall's election, state Sen. Brian Dahle, said the bill was "a steppingstone to unionize all these workers," if you can even believe it.
The Washington Post explains that the law could signal some real innovations in fast food labor representation, in the form of "sectoral bargaining,"
which involves industry-wide negotiations, rather than talks between individual unions and employers. Sectoral bargaining is difficult under U.S. labor laws, and traditional collective bargaining is often challenging in the fast-food industry, according to the left-leaning Center for American Progress Action Fund.
A 2020 report by the Harvard Law School project Clean Slate for Worker Power noted that franchising models often create environments in which the individual franchise owner negotiates with the union, rather than the union negotiating with the larger corporation. That incentivizes the franchise owner “to pass any wage gains secured by the union onto the customers in the form of higher prices” and, in turn, seek to “prevent unionization at all costs,” the researchers wrote.
This sectoral bargaining thing sounds like some real thinking outside the bun. If this law will help fast food workers get better representation, we're lovin' it.
The Post adds that the International Franchise Association (IFA), the trade group representing the industry, called the legislation a "fork in the eye to franchise owners and customers at a time when it hurts most," although the franchisees' statement would have been greatly improved if they'd said spork. The group claimed that franchise owners had let it know they "do not know how they will be able to make it once this bill goes into effect."
Gosh, it's the same argument trotted out to oppose minimum wage increases, and it's some bullshit, since the eventual standards will apply industry-wide, putting no particular franchise at a disadvantage. And golly, if fast food workers have better wages and some predictability in their work hours, they might even be more likely to go out for fast food, though maybe not at their own restaurants.
The trade group waved around a University of California at Riverside study that predicted that if fast food worker pay were to increase by 60 percent, consumer prices would go up by 20 percent. Mind you, that's far higher than any actual wage increase being considered; the study also noted that if the entire industry increased wages to the $22/hour cap, that would be an increase of 46.7 percent over California's current minimum wage, and would cause price hikes between 13.6 and 17 percent.
The study, we'll note, doesn't seem to have factored in the likelihood that with a living wage, fewer fast food workers would have to hold multiple jobs, and that just might improve employment overall. We keep forgetting that people having jobs is a bad thing, darn us.
The bills's sponsor, Assembly Member Chris Holden (D), is actually a former Subway franchise owner, back in the '90s, and said in a statement that
"as a former franchisee, I am aware that time is of the essence" to increase wages and protections for fast-food workers.
The bill would “lift up small business owners and essential workers swiftly with an inclusive approach to business,” resolving “longstanding issues in the fast-food restaurant sector,” he added.
In conclusion, while we have only the vaguest pre-pandemic memories of actually sitting inside at a fast food joint, this sounds like a terrific deal for California workers, and we hope the idea spreads to other states. We're betting America won't be abandoning its fast food anusburgers anytime soon.
UPDATE: Well that didn't take long. Politico reports:
Less than 48 hours after Gov. Gavin Newsom signed landmark legislation regulating fast food labor, a group led by the International Franchise Association and the National Restaurant Association filed a referendum seeking to overturn the law. They needn’t win this battle to reap some benefits. Qualifying a referendum suspends the law in question until voters can weigh in.
Politico also notes that the cost of spending millions to collect signatures and write a bill will be a bargain compared to actually raising wages, too. Isn't America the greatest?
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