AB 257, termed the Fast Food Accountability and Standards Recovery Act or FAST Recovery Act, proposes to establish a Fast Food Sector Council to regulate California’s fast food restaurants.  The council would be composed of 10 members who are not elected, but are appointed by the Governor, Speaker of the Assembly, and the State Rules Committee.  The council would have the power to set standards for minimum wages, working hours, “and other working conditions related to the health, safety, and welfare of” fast food establishments.  The bill is being voted on next week by the California Senate.  Here are five key aspects of the proposed bill to regulate California restaurants:

1. AB 257 regulates “fast food chains.”

As drafted, the bill permits the council to regulate fast food chains.  The bill defines “fast food chain” as “a set of restaurants consisting of 100 or more establishments nationally that share a common brand, or that are characterized by standardized options for decor, marketing, packaging, products, and services.”  The bill would add another layer of complexity for these restaurants in addition to the existing Labor Code.

2. Permits the Council to increase the minimum wage for fast food workers to $22 per hour by January 1, 2023.

The bill permits the council to set standards for minimum wages, maximum hours of work, and other working conditions for fast food restaurant employees.

The bill permits the council’s ability to increase minimum wage for restaurant workers, and requires that any minimum wage set by the council can be as high as $22 per hour between January 1, 2023 to December 31, 2023.  Thereafter, the minimum wage can increase at the less of 3.5% or the rate of change set by the U.S. Bureau of Labor Statistics.

If on January 1, 2029, the council is no longer operative, the minimum wage set for fast food restaurant employees in effect on December 31 shall be increased by the lesser of 3.5% or the rate of change set by the U.S. Bureau of Labor Statistics.

The bill requires the council to meet at lease once every 6 months.

“Working conditions” is defined by the bill to “include, but are not limited to, wages, conditions affecting fast food restaurant employees’ health and safety, security in the workplace, the right to take time off work for protected purposes, and the right to be free from discrimination and harassment in the workplace.”

3. Permits “Local Fast Food Councils”

A county, or a city with a population of greater than 200,000, may establish a Local Fast Food Council.  These local councils have the ability to provide recommendations to the council.

4. Protects employees who disclose information to “watchdog or community based organizations.”

The bill also prevents a fast food restaurant operator discharging or retaliating against any employee if the employee made a complaint or disclosed information to the media, or to a “watchdog or community based organization” regarding employee or public health or safety.

Also, under the bill, employers may not take adverse actions against employees if “[t]he employee refused to perform work in a fast food restaurant because the employee had reasonable cause to believe that the practices or premises of that fast food restaurant would violate worker or public health and safety laws.”

5. As currently drafted, the bill deleted the aspect of the law that made franchisors jointly liable for franchisees’ violations.

The current version of the bill published as of Friday, August 26, 2022, removes the language from the bill that would hold franchisors jointly liable for franchisees’ violations.