California Bill Would Give Fast Food Workers Sway Over Labor Standards

Fast food workers in California would gain a new venue where they could press for wage increases and other workplace improvements under union-backed legislation that a state Assembly committee plans to discuss this week.

Assembly Bill 257 calls for establishing what’s known as a “sectoral council” for the state’s fast food industry. The proposed panel would include representatives for fast food restaurant management and employees, and from a number of state agencies. The council would be charged with setting industry wide minimum standards around pay, as well as other working conditions.

David Madland, a senior fellow at the left-leaning Center for American Progress, said that if California implements a sectoral council structure for fast food workers it would be a unique arrangement within the industry. He pointed out the sector has been long-criticized for low wages, scant benefits and for problems with labor law violations and employee harassment.

“This is a first, and I think it’s a really important first to show that there are ways to transform the fast food industry,” said Madland, who authored a brief released Tuesday looking at the California plan and sectoral councils more generally. 

“Ideally this can be a model for other states to follow,” he added.

A major industry group, the California Restaurant Association, is opposed to the measure. One of the association’s arguments against the bill is that it would add stress to businesses that have taken a hit over the past year due to the coronavirus pandemic.

“This proposal would be a problem at any time, but it’s especially problematic as restaurants are trying to get back on their feet and not even fully reopen,” Matt Sutton, the group’s senior vice president of government affairs, said in an emailed statement.

The legislation was authored by Lorena Gonzalez, a former labor leader and organizer who represents a district in the San Diego area.

Gonzalez, a Democrat, spearheaded the effort around California’s AB 5, the 2019 legislation that codified standards for when companies could treat workers as independent contractors as opposed to full-fledged employees. App-based ride-booking and delivery services, including Uber and Lyft, ultimately beat back how that law applied to their businesses through a ballot initiative voters approved last year.

AB 257 is scheduled for a hearing on Thursday before the Assembly’s Labor and Employment committee. A spokesman for Gonzalez said the assemblywoman was unavailable for an interview and suggested contacting the Service Employees International Union for more information on the bill. SEIU wasn’t able to immediately arrange for an interview with a union representative.

When she introduced the legislation earlier this year, Gonzalez said in a statement that, “Fast food workers need the authority in state law to shape their own workplace standards and hold their employers accountable without facing retaliation.”

AB 257 would establish the Fast Food Sector Council, composed of 11 members appointed by the governor and state legislative leaders. The members would include five representatives for state agencies that deal with labor, workplace and public health issues, two representatives for fast food businesses, two for restaurant employees, and two for “advocates” for the workers.

One industry representative would be for restaurant franchisors—companies like McDonald’s or Burger King—and one would be for franchisees, who run the chains’ eateries.

The council would be responsible for setting standards on wages, working hours and other issues, such as employee safety. There are mechanisms in the bill to allow for these recommended standards to override other state agency rules and regulations.

The legislation calls for franchisors, the large fast food corporations, to share in the liability and responsibility that comes with upholding labor laws and standards. It would apply to restaurant brands with 30 or more establishments nationwide that also meet other specifications having to do with things like branding and services.

Restaurants oppose the bill

Sutton, with the restaurant association, said the bill wrongly “takes decisions about labor law and puts them in the hands of an unelected body.” And he raised concerns that language in the legislation characterizes franchisees as employees of franchisors. 

“If you run a franchise, you wouldn’t be treated as the owner of that business, but as an employee of the national brand,” he said.

There are similarities between the proposed council and “wage boards” established in New York state in recent years that have focused on pay issues in the fast food industry and for farmworkers. Madland explained that the California council would have broader responsibilities than those boards, delving into issues beyond just wages, and it would be structured differently.

He said that the council would more closely resemble a labor standards board in Seattle for domestic workers, like house cleaners, cooks and nannies.

Madland said past attempts to organize fast food workers in traditional unions have struggled, due in part to how federal labor laws work and the nature of the industry. The fast food workforce tends to have high turnover, and the franchise model means workers are fragmented across a chain’s individual restaurants, complicating organizing.

Meanwhile, franchisees who operate the eateries are often squeezed because they have to adhere to policies set by their parent companies for pricing, suppliers and other aspects of their businesses. This can make it difficult for them to raise wages or add benefits.

Madland’s brief notes that fast food workers in California earn some of the lowest wages in the state, about $13 an hour on average. He also cites statistics indicating that 60% of fast food workers nationwide are over 20 years old and that in California more than 80% are nonwhite.

Workers will be ‘heard and protected’

Laura Pozos works at a McDonald’s in the Los Angeles area and is advocating for AB 257. She said she has held the job for about five years and makes $15 an hour. Two improvements Pozos said she’d like to see would be having a predictable, fixed work schedule, rather than variable hours and stronger processes in place for reporting problems like sexual harassment.

Pozos also complained that while she was technically hired as a cook, she is regularly assigned to other work duties, like cleaning restrooms and floors and taking out trash. 

She said that the sectoral council would provide a forum where workers could propose solutions to these and other concerns without fear of retaliation. “The way things are, we really can't express ourselves about our issues with the big corporations that we work for,” she said in Spanish, through a translator. “The fast food sector council would free us to be heard and protected.”