A two-year-long struggle between labor organizations and major players in the fast food industry has reached its conclusion with a last-minute agreement unveiled today. Under the terms of this agreement, fast food workers are poised to receive a significant boost in their minimum wage, with a new $20 minimum wage set to take effect as early as next April. In exchange for this wage hike, businesses have committed to withdrawing their proposed November 2024 ballot measure, which aimed to dismantle a pivotal law governing the fast food sector.
This landmark agreement, which is outlined in the revisions made to Assembly Bill 1228, serves to prevent what would have undoubtedly been a costly and contentious campaign for both parties. Importantly, it grants workers a meaningful wage increase while addressing a contentious issue for the industry: a proposal that would have held fast food corporations legally accountable for labor violations that occurred in their franchise establishments.
The law in question, enacted in 2022, was designed to establish a state-administered council comprising both worker and business representatives. This council would have been responsible for formulating regulations governing wages and working conditions within the fast food sector—an industry that has long resisted unionization efforts by labor organizers. Notably, the council would have wielded the authority to elevate the minimum wage for fast food workers to a potential maximum of $22 per hour, a notable increase from the forthcoming statewide minimum wage of $16 per hour set to take effect on January 1.
However, this law encountered swift opposition, as restaurant associations and major fast food corporations rallied to accumulate substantial financial backing for a signature-gathering campaign aimed at bringing the law’s repeal to a statewide vote in 2024. In July, the referendum campaign announced a staggering $50 million “initial contribution,” with prominent names such as McDonald’s, In-N-Out, Chick-Fil-A, the International Franchise Association, and the National Restaurant Association among the contributors.
Advocates for the law, spearheaded by the Service Employees International Union, contended that the fast food industry, which employs over half a million Californians, urgently required regulatory oversight. They cited persistently low wages, erratic scheduling practices, and challenging working conditions in many fast food establishments, often managed by independent franchise operators rather than the parent corporations.
Ingrid Vilorio, a prominent figure in the efforts to unionize fast food workers, commented on the development, stating, “For the last decade, fast-food cooks, cashiers, and baristas in California have been sounding the alarm on the poverty pay and unsafe working conditions plaguing our industry. We have always known that to solve these problems, we need a seat at the table with our employers and the power to help shape better rules across our industry.”
The agreement marks a significant turning point in the ongoing debate over labor rights and wages within the fast food sector, ensuring that workers will soon see a tangible improvement in their compensation while averting a contentious battle at the ballot box in 2024.
