A new California law raising the minimum wage for fast-food workers to $20 an hour on April 1 may undergo new changes as early as this month, as well as into the future as a result of wrangling by policymakers.
The state Assembly could send Gov. Gavin Newsom (D) legislation as soon as this week to exempt fast-food restaurants in airports, stadiums, and a long list of venues from the 2023 law.
Meanwhile, the governor has recently appointed a chair of a council created under the law with the power to raise the minimum wage yet again in 2025 and set separate rates for different parts of the sprawling state.
But there appears to be little appetite among state lawmakers to reexamine how an existing carve-out could benefit a Newsom campaign donor, who is also a major Panera Bread franchisee. The uproar has led the governor’s office to determine that the fast-casual chain will not be exempt from the measure after all.
The flurry of activity around implementing the new law (A.B. 1228) underscores how workers’ rights in California’s fast-food industry continue to evolve, even after passage of legislation last year that signaled a sort of truce between labor unions and restaurant owners. Indeed, the aftermath of the law has required cleanup to satisfy other unions and led to election campaigns by restaurant owners to defeat lawmakers who backed the law.
Exemptions Advance
The state Senate voted Feb. 29 to pass legislation (A.B. 610) that would include a series of exemptions from the minimum wage law at the behest of UNITE-HERE, the labor union representing many fast-food workers in tourism-related industries, such as in airports and theme parks. The union says they are typically paid more than those at the large franchise operations like
The measure sailed through the Senate last week on a 31-4 vote, where state Sen. Monique Limón argued the provisions would help ensure the minimum wage law did not inadvertently create a wage ceiling rather than a floor in some workplaces.
“This bill is clarifying in nature and simply ensures that restaurants operated in conjunction with large facilities will not be subject to the provisions of” the 2023 law, she said.
Republicans moved unsuccessfully to kill the measure, however, citing reporting by Bloomberg News revealing how a separate, unexplained carve-out for restaurants that make and sell their own bread could benefit Panera Bread.
Bloomberg News found a major Panera Bread franchisee and Newsom campaign donor backed the exemption, though he said he never spoke directly with the governor about it.
Newsom said over the weekend that Panera Bread will not be exempt from the new, higher minimum wage and defended the law as one that other states should emulate.
“You want some folks to have some dignity in their lives, some opportunities, some growth. This is nation-leading and I’m proud of that,” Newsom told KNBC-TV’s Conan Nolan in an interview over the weekend.
New Council
In a related move, Newsom last week appointed a chairman to the council created under the fast-food minimum wage law, which is required to meet by March 15.
The nine-member council will have the power to raise the minimum wage in the industry by up to 3.5% a year, starting in 2025, and set different rates for different regions of the sprawling state with more than 500,000 workers in the sector. The council can also call for new regulations on working standards in the fast-food industry.
The new law calls for the council to be chaired by an unaffiliated member of the public.
For that role, Newsom has tapped a longtime legislative aide, Nicholas Hardeman. He is chief-of-staff to state Sen. Toni Atkins (D), the former president pro tempore who recently launched a campaign to succeed Newsom as governor in 2026.
The council is otherwise designed to be split between labor and industry, with two fast-food restaurant employees; two advocates for restaurant workers; two representatives from the fast-food restaurant industry; and two representatives of fast-food restaurant franchisees.
To those roles, the governor appointed SG Ellison, CEO of Diversified Restaurant Group; Piardip “Joe” Johal, CEO of Wendy’s of the Pacific; Richard Reinis, partner at Thompson Coburn LLP; and Michaela Mendelsohn, president and CEO of Pollo West Corp.
Newsom also named Anneisha Williams, a shift leader at
Legislative leaders appointed the representatives for fast-food workers. Assembly Speaker Robert Rivas (D) tapped Maria Maldonado, deputy field director for SEIU’s fast-food workers union. The Senate Rules Committee appointed Joseph Bryant, an international executive vice president of the SEIU.
The workers on the council have already established several priorities, including pursuing the maximum 3.5% wage increase and creating new rules on scheduling as well as unfair at-will firings.
“We endure a lot of things in this industry that people ignore,” said Williams, the Jack in the Box shift leader appointed to the council. “We deal with violence on the job, we deal with harassment, the bullying, the unfair fair scheduling and things like that.”
The council has scheduled its first meeting for March 15 in Oakland. The agenda is relatively short and includes a swearing-in ceremony, public comment as well as a discussion of the council’s function.