Get the latest on California’s Fast Food Council, $20 minimum wage debates, and stalled decisions affecting workers and franchise owners. See how conflicting research, rising menu prices, and council delays could influence jobs, hours, and the future of fast food.
By Brad Nakase, Attorney
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AB 1228 was enacted into law last year. It created the Fast Food Council of California. Fast-casual & quick-serve restaurant concepts, in addition to franchise & non-franchise models, are all subject to Council regulation. With more than 60 locations across the country, it has regulatory authority over counter-service restaurants.
The Fast Food Council of California wants to establish minimum requirements for working conditions. The Council has a lot of power. In an effort to encourage restaurant operator representation on the Council and the numerous operators around the state, the CRA is going to take part in upcoming Council hearings.
After a year of California’s historic attempt to regulate working conditions for over 500,000 fast food staff members, the state council tasked with monitoring the sector has only decided how to hold meetings.
A cost-of-living increase to the $20 minimum wage for fast food workers that came into effect last April is being considered by the nine-member council, which is made up of business owners, employees, and union members. It intends to raise that threshold by 3.5% or the rate of inflation from the previous year, whichever is less, at the next session, which has not yet been set.
However, it won’t accomplish anything more. The council chair placed the raise on the subsequent agenda for debate only, not a vote, following two long sessions in January & February, where a smaller group of council members attended to hours of remarks from employees and their allies, as well as owners of restaurants and their allies.
Since it started meeting in March of last year, that is the nearest the Fast Food Council of California has come to a policy choice.
The speed at present is to be expected, according to Fast Food Council of California Chairman Nick Hardeman, a previous state Senate employee nominated by Governor Gavin Newsom to be the only “public” representative of the council, unrelated to either industry or labor. He compared the task to creating an entirely new division from the ground up, stated that he and the council’s members have hired three employees over the past year, and expressed the aim of soon establishing guidelines for future voting procedures.
“It took a lot of effort to lay the foundation so that we could proceed toward real conversations concerning policy,” Hardeman stated. Making decisions is difficult. When we discuss issues, a lot of the participants come from two very different backgrounds, and you can see it in every meeting.
To be able to directly negotiate wages and conditions of employment on behalf of the whole fast food industry, the Service Employees International Union suggested a European-style state assembly in 2021. Fast food companies spent millions trying to repeal the rule after Newsom and the state’s Democratic-controlled legislature adopted it.
A twenty-dollar minimum wage for employees at fast food restaurants that are part of a chain with at least sixty locations nationwide was mandated by the agreement that Newsom signed in 2023. It also established a statewide council that was equally divided between employers and workers and had a neutral chairperson. The council’s authority to approve additional raises was limited.
The two camps of the council have stated that they want to discover ways to enhance the industry through compromises, but meetings, which have taken place roughly six times since last March, have mainly concentrated on what the committee should debate.
Concerns regarding wage theft, companies decreasing hours, and the expense of living have been voiced by a large number of workers around the state who have either called in or joined those meetings.
According to a formula created by experts at the Massachusetts Institute of Technology, 20 dollars an hour remains far from what the typical single Californian with no children requires to make ends meet, even if it is more than twenty percent higher than the state’s usual minimum wage. A hearing has been requested by workers and their representatives on the council so that they can more thoroughly present their claims of workplace violations.
Franchise owners have been pleading with the Fast Food Council of California to vote against further hikes, threatening to close their restaurants and outlining how they have reduced workers or hours to cover the costs of the increase in the minimum wage. Some proprietors have highlighted their own modest upbringings as a gesture to the route that people of color might take to become business owners in the franchised restaurant sector.
Researchers have released conflicting data regarding the impact of the salary hike since last April.
There were ten thousand fewer employment opportunities in the fast food sector in California between June 2023 & June 2024, the most recent month accessible for that dataset, according to a recent business-commissioned analysis from the company Berkeley Research Group. Additionally, it found that the law raised menu costs by 14.5%.
However, UC Berkeley researchers claimed that Berkeley Research Group neglected to take into consideration changes across different restaurant sectors or control for how seasonal fluctuations in the business manifest differently in California compared to the rest of the nation, in another study that was praised by labor. According to the UC Berkeley study, there was just a 1.5% rise in menu prices and little impact on fast food jobs.
According to more recent government data, employment growth in California’s limited-service restaurant sector has essentially stagnated for the past 18 months.
Economist Arindrajit Dube of the University of Massachusetts at Amherst, who specializes in minimum wages, warned against contrasting California jobs without also assessing them to a similar, modest slowdown in restaurant jobs across the country, saying it’s still too early to determine the impact of the wage increase. “It is safe to assume that a large amount (most, but not the entirety) of the cost of labor rise has been transferred through to prices,” he wrote in an email.
Whether or not workers’ hours have changed is not captured by any of the studies.
Corporate officials from McDonald’s, Burger King, and other prominent fast food giants are an essential element absent from the conversations on fast food.
McDonald’s and other franchisor firms invested hundreds of thousands of dollars in the effort to thwart a more comprehensive idea when Congress first contemplated a fast food council.
They haven’t attended many council sessions lately. Rather, their franchise owners, who are in charge of wages and employment and pay royalties & branding fees to run the restaurants on their own, speak up at council meetings to oppose additional wage rises.
Owners of restaurants and those who support them on the council are requesting their peers to put their attention elsewhere. Rich Reinis, a council member and owner of a Krispy Kreme franchise, proposed last week that the council talk about ways to help workers impacted by the wildfires in Los Angeles or those who are frightened to report to work due to heightened immigration enforcement.
The director of the California Fast Food Workers Union and council member Maria Maldonado stated, “We can speak about a lot of excuses to postpone the conversation.” “However, employees continue to wait for us to discuss the increase in living expenses and how to render this council beneficial.”
For the purpose of examining its role in handling complaints by fast food workers, the council had planned a hearing involving state labor agency executives in January. The LA Flames caused the session to be postponed. It is yet to be rescheduled.
Rich Tieu is the owner of two McDonald’s outlets in Santa Clara County. The twenty-dollar wage rise went into force last April. His workforce was reduced from 80 to less than 70.
According to him, council members “haven’t actually fully structured to where they truly have stuff on the agenda.” “They have just been discussing rising labor costs and nothing else. They ought to consider additional aspects, in my opinion.
Marina Orozco, a student at college and employee of Chipotle in Sacramento, had been expecting the council would authorize a raise. She is struggling to pay for rent & the latest tuition hike. She also requests a hearing on the working conditions.
“It feels incredibly amazing to finally meet with our employers and express our views and ideas, even if this is an unfamiliar process and it could take some time,” she remarked.
The story isn’t finished. The council is still slow, still trying to find its shape. Workers wait, and owners worry. And the debates keep circling back to the same questions: wages, hours, and survival. Nothing moves fast, but something is shifting. You can see it in every meeting, even in the arguments. California tried to build a new system, and now everyone is learning how to live inside it. Not clean; not simple; but real. And whatever comes next will shape fast food work for years. Maybe even redefine how the state talks about labor at all.
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