Judge halts California fast-food law as restaurants, unions hammer each other
Industry group seeking to get referendum on November 2024 ballot
A judge of the Sacramento Superior Court ruled Friday to block a proposed law in California that would give the state authority to negotiate the wages and working conditions of fast-food workers.
The block is dependent on the outcome of a proposed referendum pushed by fast-food giants to stomp out the proposed changes.
The Fast Food Accountability and Standards Recovery Act ("FAST") has seen significant pushback from restaurateurs and franchisees as workers' unions fight to give the state a seat at the table in negotiating wages.
FAST-FOOD FRANCHISEES SAY CALIFORNIA'S AB 257 COULD INCREASE COSTS, UNDERMINE BUSINESS MODEL
A sign is posted in front of a McDonald's restaurant on April 28, 2022, in San Leandro, California. (Justin Sullivan/Getty Images / Getty Images)
The law would establish a 10-member council capable of setting minimum wages and parameters for work hours at fast-food restaurants within the state.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| MCD | MCDONALD'S CORP. | 298.56 | +1.21 | +0.41% |
| CMG | CHIPOTLE MEXICAN GRILL INC. | 59.91 | +0.64 | +1.08% |
Restaurant industry interest groups are seeking a November 2024 referendum to kill the legislation.
MCDONALD'S USA PRESIDENT JOE ERLINGER CRITICIZES CALIFORNIA FAST-FOOD WORKERS BILL
California Gov. Gavin Newsom angrily denounced the U.S. Supreme Court's decision to overturn Roe v. Wade, during a news conference in Sacramento, Calif., Friday, June 24, 2022. (AP Photo/Rich Pedroncelli / AP Newsroom)
Election officials have not yet finished counting the signatures on the referendum proposal, but if a sufficient amount are counted, the court's ruling will halt the law from taking effect until Californians can weigh in.
California's Department of Industrial Relations will begin setting the law into motion on Sunday pending a successful reform petition. However, concrete negotiation of wages will likely not begin until late next year.
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The Service Employees International Union was a key champion of the legislation.
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The union has accused McDonald's, Chipotle and other chains by name as disregarding workers' well-being for the sake of business considerations.