California Gov. Newsom signs law that could pay fast food workers a minimum $22 an hour

California Gov. Gavin Newsom signed the FAST Recovery Act, which is a new legislation that grants staff at fast food restaurants an input on hourly pay and working conditions, along with the power to increase the minimum wage next year to $22 an hour.

AB 257, which Newsom signed on Labor Day, will create 10-member council of fast-food staff, franchisees, franchisors, unions for fast food employees, and staffers from the governor’s office. 

The council will agree on an acceptable level on standards on wages, working hours, and other miscellaneous working conditions which relate to the health and safety of fast food workers. The legislation is applicable to all fast-food chains with more than 100 locations, including Starbucks, Wendy’s, Burger King, and McDonald’s.  

“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,” said Governor Gavin Newsom, who is also a restaurant owner. “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 fast-food industry however have hit out at the bill and have accused the government of not thinking things through. Joe Erlinger, who is President of McDonalds USA, dubbed the legislation “lopsided, hypocritical, and ill-conceived.”

Erlinger also said that the new council will “hurt everyone” as it is only applied to those with over 100 locations, while those with less than 100 locations remain exempt.

The International Franchise Association also blasted the bill, referring to it as a “discriminatory measure designed to target the franchise business model.”

IFA president and CEO Matthew Haller released a statement saying that the bill would hurt smaller franchise operators and cited a study that hinted higher wages could bring about a 20% increase in menu prices. The National Restaurant Association also opposes the bill.