1664685149 Fast food chains raise millions to oppose California wage law

Fast food chains raise millions to oppose California wage law

The Save Local Restaurants coalition announced Friday that it has raised about $12.7 million to fight the law, known as the FAST Recovery Act. Corporate brands have contributed $9.9 million, and individual franchisees have donated $2 million, including KFC and McDonald’s restaurant owners. According to the coalition, the remainder falls to the trade associations.

The coalition wants to delay implementation of the law, which is due to begin on January 1, and let voters decide through the state referendum whether to permanently block the law in 2024. Opponents must collect hundreds of thousands of signatures for the referendum to take place and suspend implementation of the law until the vote.

“Californians will bear the cost of this new law, so it’s only right that they have a say in whether it should stand,” said Matthew Haller, president of the International Franchise Association.

A spokesman for California Gov. Gavin Newsom, a Democrat who signed the FAST Recovery Act into law on Sept. 5, declined to comment.

Fast food chains raise millions to oppose California wage law

McDonald’s spent around $360,000 in efforts to force a nationwide referendum on the law.

Photo:Jeff Chiu/Associated Press

Starbucks, In-N-Out Burger and Chipotle each gave the coalition $2 million, according to a filing filed late Friday. KFC and Taco Bell’s parent company Yum Brands Inc. donated $1 million, while Chick-fil-A Inc., Wingstop Inc. WING -0.37% and Panda Restaurant Group Inc. each donated $500,000 , as the filing shows.

McDonald’s has contributed approximately $360,000, while several of the burger chain’s individual franchisees have each donated thousands of dollars.

Burger King, Subway and Domino’s Pizza Inc. DPZ -1.94% each gave $250,000, while Wendy’s Co. WEN -0.37% contributed $150,000, the filing shows.

The International Franchise Association, the National Restaurant Association and the U.S. Chamber of Commerce are leading the coalition and also donated around $250,000 each, the filing showed. The restaurants declined to comment. Wingstop did not immediately respond to a request for comment.

The current minimum wage in California is $15 an hour and is set to increase by 50 cents next year. The law would see California create a 10-member council of workers, union representatives, employers and business representatives that could set a minimum wage of up to $22 for fast-food workers next year. This minimum would increase annually based on inflation.

The law would apply nationwide to fast-food restaurants with more than 100 locations. It also prohibits fast-food operators from retaliating against employees who file grievances and sets the framework for reinstatement of arrears of wages or jobs for those who do so.

1664685142 306 Fast food chains raise millions to oppose California wage law

Chipotle is part of the coalition led by the International Franchise Association, the National Restaurant Association and the US Chamber of Commerce.

Photo: Justin Sullivan/Getty Images

Organized labor lobbied the state-appointed council, saying it would better protect workers and improve wages in an industry unions struggle to represent. Since its passage, advocates have continued to campaign for the law’s implementation.

Earlier this week, workers and activists protested outside a Chick-fil-A restaurant in Ventura, California, claiming the restaurant discriminated against a worker who was pushing for better working conditions.

“Fast food companies are publicly unwilling to obey the law, they’re spending millions to overturn it and take our place at the table,” said the local branch of Fight for $15, a union-backed advocacy group, in Los Angeles on social media.

A Chic-fil-A spokeswoman declined to comment.

Restaurant owners said the law would force them to raise wages so quickly they would have to raise menu prices or reduce hours. Large fast-food chains and their franchisees have also accused lawmakers of segregating them from other types of restaurants or industries.

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“Our point is, just give us a level playing field. Don’t try to pick winners and losers,” McDonald’s chief executive Chris Kempczinski said last month when asked about the law.

Opponents of the new law must submit around 623,000 valid voter signatures by Dec. 4 to put the law on hold and qualify for a referendum in the November 2024 vote, the state said. Referendum advocates in California often spend millions of dollars collecting the signatures needed to take part in voting, and usually have to collect more than the minimum because election officials can disqualify some.

Proponents of the law must also collect signatures from 10,000 fast-food restaurant workers to formally establish the council. The Service Employees International Union, which is expected to play a large role in collecting the signatures, declined to comment on their efforts.

write to Heather Haddon at [email protected]

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