Restaurant groups push to repeal California’s fast food council law

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Diving brief:

  • The National Restaurant Association and the International Franchise Association have formed a coalition to support a referendum initiative on California’s new fast food council law, according to a press release emailed to Restaurant Dive.
  • The coalition has just under three months to collect more than 600,000 signatures needed to put the repeal of AB 257 on the ballot in the 2024 general election, according to the state government website.
  • The California referendum system allows groups unhappy with the legislative results to overturn these laws through statewide elections.

Overview of the dive:

The coalition, called Protect Neighborhood Restaurants, argued that Newsom should never have signed AB 257. The law establishes a council of industry, labor and state representatives to set wages and conditions working in chain restaurants with more than 100 units nationwide. The coalition says AB 257 would drive up costs, especially given a provision allowing the council to set the minimum wage for the fast food industry at $22 an hour.

“By signing this bill, Governor Newsom picked the winners and losers and left me, a restaurant franchisee, to hold the bag for whatever this unelected council throws at me,” Jesse Lara, regional manager of a co-owned El Pollo Loco franchise. by his father, said in a press release. “This bill will make it harder to live, work and own a business in the state.”

The referendum effort was launched on September 6 when two California residents submitted a proposal for this with the State Attorney General. Supporters of AB 257 decried the proposed ballot measure.

“We won AB 257 by speaking up, standing up and going on strike to show the billion dollar fast food companies that we need a voice at work to force them to take responsibility. systemic issues such as violence, low wages, wage theft and sexual harassment,” said Sandro Flores, a Carl’s Jr. employee in Los Angeles and organizer of Fight for $15 and a union in a statement emailed to Restaurant Dive: “This election action is not going to stop us.”

Mary Kay Henry, International President of the Service Employees International Union (SEIU), said in a statement that the referendum campaign is an attempt by fast-food companies to “evade a law aimed at raising the wages of their workers.”

The SEIU, which organized fast food workers through its national corporate campaigns, was the main labor force pushing for AB 257.

As California experiments with labor law reform, the referendum process has become a bulwark against the regulation of state business interests. Expenses related to running a statewide campaign in California, which has almost 27 million eligible voterscan benefit industrial groups with considerable purchasing power.

Prop 22, the 2020 ballot initiative that struck down the state law classifying gig workers as employees, proved a costly election. Referendum supporters, led by food delivery and ride-sharing companies, outspent referendum opponents about 11 to 1, spending about $188 million of the roughly $16 million spent by unions and their allies. In 2021, however, a California judge overturned Proposition 22.

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