Amid and to cover child care and housing, California is considering a radical proposal: Allow the state to negotiate wages, hours and work conditions for an entire industry.
Proponents in the state Legislature say one solution to inequality is to empower workers to negotiate through unions, but that鈥檚 not happening in the fast food industry where frequent turnover, inexperience and intimidation make it too difficult for workers to
organize. Only belong to unions nationwide.
In Sacramento, a union-backed Democratic proposal called the Fast Food Accountability and Standards Recovery Act, or , would establish a state-appointed council to enact industry-wide minimum standards for wages, working hours and work conditions. If passed by state lawmakers and signed by Gov. Gavin Newsom, the proposal
would also hold corporate franchisors responsible for compliance, not just the local franchise owners.
鈥淐alifornia has the opportunity to really pave a path forward in a way that can work for both workers and employers,鈥� said David Madland, a senior adviser to the American Worker Project at the Center for American Progress, a liberal Washtington, D.C., think tank.
Legislation to approve the FAST Recovery Act, AB 257, fell three votes short of passing the state Assembly last June with eight Democrats voting no and another 13 not voting. Newsom did not take a position.
With strong support from major state labor groups, the issue is expected to resurface this year even though the bill鈥檚 author, Assemblymember Lorena Gonzalez, unexpectedly resigned from office the first week of January to transition into chief officer of the California Labor Federation, which supports the proposal.
One of the nation鈥檚 largest unions, Service Employees International Union, vowed to continue pushing the bill. It funds the Fight for $15 and a Union campaign, which organizes low-wage workers to advocate for better wages and work conditions, primarily in fast food. Fight for $15 is planning an art demonstration, downgraded from a rally due to Omicron concerns, on Wednesday at the state Capitol and Assembly Speaker Anthony Rendon could transfer authorship to a committee or another lawmaker.
鈥淭he path forward on this bill is still being worked out,鈥� said Rendon鈥檚 spokesperson Katie Talbot.
Address low wage and poor conditions
Proponents, who have set up a , say the FAST Recovery Act is needed to address low wages and poor conditions for workers. California鈥檚 fast food workers 鈥� a majority of
whom are people of color, Latino and women 鈥� made an in 2020, with California鈥檚 minimum wage rising to . Proponents also point out they are and more likely to encounter .
A documents dangerous conditions during the pandemic, with nearly a quarter of surveyed workers having contracted the virus. Less than half said their employers offered paid sick leave 鈥� mandated by state and
federal law 鈥� to workers who got COVID-19.
鈥淚t may not be in the cards to have the kind of traditional labor format we鈥檝e seen in the United States in the near future,鈥� said Saru Jayaraman, director of the UC Berkeley Food Labor Research Center. 鈥淏ut it may very well be in the cards to see these really innovative
sector-wide, power-building strategies that change entire sectors.鈥�
The idea of negotiating wages and work conditions for an industry, rather than for each workplace separately, has been modeled for many years in Europe and around the world. Known as 鈥渟ectoral bargaining,鈥� it has also gained support among progressives in the U.S. such as and as a way to reduce income inequality.
of sectoral bargaining in other countries have found evidence that it reduces inequality, and 鈥� with some . But a number of European studies find that sectoral bargaining can reduce profits or productivity for companies. found that sectoral bargaining led to more layoffs during the Great Recession in Europe.
Under current American labor law, true sectoral bargaining is rare because multiple employers would have to voluntarily agree to come to the same negotiating table with workers, said Madland, the researcher at the Center for American Progress. He says America achieved this in the auto industry more than a century ago, and .
However, American 鈥渨orkers cannot insist on multi-employer bargaining,鈥� unlike in other countries, he said.
The California proposal would carve a state path by directing an 11-member council 鈥� composed of fast food workers, franchisees and franchisors, and state health, safety and labor officials 鈥� to do the negotiating. The governor and leaders in the state Senate and Assembly would appoint the members. Its rules would be revisited every three years and, unlike traditional collective bargaining, they would be enforced by state agencies. The laws would apply to every restaurant that belongs to a fast food chain with 30 or more franchises.
Opposition from business, moderate Democrats
It鈥檚 a highly controversial proposal with opposition from industry, Republicans and a divide among Democrats.
Before the bill鈥檚 failed Assembly vote in June, Assemblymember Ken Cooley, a moderate Democrat from Rancho Cordova, said the power given to an unelected council was an 鈥渆xceedingly problematic鈥� precedent that is 鈥渦ndermining of the rule of law.鈥�
Business groups are also adamant the government stay out of private negotiations. They argue the free market adjusts wages where it is needed, citing the fact that many California fast food restaurants are now raising their wages to $17 or $18 per hour to attract workers amid a .
Republicans said the bill was an example of government overreach that would destroy minimum wage jobs and small businesses. Meanwhile, the coalition of organizations lobbying against the bill, which include 40 local and ethnic chambers of commerce, launched .鈥�
鈥淭he people who will pay for Lorena Gonzalez鈥檚 initiative aren鈥檛 the 鈥榚vil corporations.鈥� It鈥檚 the working people who rely on that fast food鈥� for either meals or employment, said Will Swaim, president of the right-leaning California Policy Center.
Industry groups also questioned whether the new model is needed since California is known for the strictest labor standards in the country, such as being first to set the $15 minimum wage and .
鈥淭hrowing all of that out to this test case of a panel is absurd,鈥� said Matt Sutton, a senior vice president at the California Restaurant Association.
Sutton also said the FAST Recovery Act鈥檚 extension of liability to corporate franchisors could raise costs and potentially drive fast-food chains out of the state. Franchise owners testified in hearings that the bill could change the franchise model, making local owners more regulated by the corporation and less independent.
鈥淎B 257 would result in me and so many other franchisees losing our autonomy since the state would essentially be stripping us of our identity as business owners and making us basically employees for large corporations,鈥� said Michaela Mendelsohn, a franchise owner of multiple El Pollo Loco restaurants, at a spring hearing.
State-imposed bargaining
Gonzalez said she also believes her bill is not the best solution. She says the state government shouldn鈥檛 be in the business of bargaining and she would rather maintain 鈥渁 private-sector approach to reducing income inequality.鈥� Unions, Gonzalez added, do a better job responding to workers鈥� needs worksite by worksite instead of one-size-fits-all
state labor laws, which employers fight and the government enforces unevenly.
But given that businesses continue to fight union drives, Gonzalez said, and the U.S. Congress has , the FAST Recovery Act is necessary to help workers and, she hopes, encourage more support for labor unions.
鈥淢aybe an individual fast food franchisee or restaurant says 鈥榊ou know what, I鈥檇 rather have a conversation with my workers in my workplace, allow them if they so want to unionize, and provide them not what these people at the state level are bargaining for but what the workers in my workplace actually want,鈥欌�� Gonzalez said. 鈥淭hat would be a great solution.鈥�
For now, though, Assemblymember Ash Kalra, a San Jose Democrat who chairs the Assembly labor and employment committee, said that where labor organizing campaigns have failed in low-wage industries, the government needs to act.
鈥淭hat鈥檚 the only way you can do it in some of these industries,鈥� Kalra said. 鈥淲orksite by worksite is nearly impossible.鈥�
Fast food workers protest
Two McDonald鈥檚 workers agreed. At different franchises in California, both helped organize two-week walkouts during the pandemic, with support from Fight for $15.
Imelda Arroyo earns $15.50 per hour at a McDonald鈥檚 in Oakland. She has little left for her 7-year-old daughter after paying $1,950 for rent. The single mother feels she deserves better wages, health insurance, paid sick leave, and 鈥渁 place where we can explain our
concerns鈥� before having to resort to strikes.
Even though 鈥渇ast food workers like me don鈥檛 have a union,鈥� Arroyo said, 鈥渁t least we are hoping to get something like AB 257.鈥�
Another worker, Imelda Rosales, said her weekly hours were cut from 40 to 27 after protesting unsafe work conditions and unpaid sick leave last winter at a McDonald鈥檚 in a small, desert town near Palmdale.
The franchise owner, Andrew Marroquin, said the restaurant complied with paid emergency leave for all employees and didn鈥檛 retaliate, but Rosales disputes his claim.
鈥淲e have to hurry up and fight so that the law passes,鈥� Rosales said. 鈥淎nd then continue (fighting) for the union after.鈥�
This article is part of the project, a collaboration among newsrooms examining income inequality and economic survival in California.