On August 29, 2022, the California Legislature passed a heavily amended version of Assembly Bill (AB) No. 257, the Fast Food Accountability and Standards Recovery Act (FAST Recovery Act), which would provide increased rights to California’s more than 500,000 fast-food workers.

The bill is now headed to Governor Gavin Newsom, and if he signs it into law, the FAST Recovery Act would create the Fast Food Sector Council, which would be responsible for setting standards for wages, working hours, and working conditions for workers at fast-food restaurants with at least one hundred establishments nationwide.

This ten-person council would include four seats held by fast-food franchisor and franchisee representatives, four seats held by fast-food worker representatives and advocates, and two seats held respectively by one representative from the California Department of Industrial Relations and one representative from the Governor’s Office of Business and Economic Development.

The current bill has significant changes from its previous versions. Most notably, under a previous iteration, fast-food franchisors would have been jointly and severally liable for wage and labor violations at franchisee locations. There is no such provision in the current version of the labor-backed bill.

Other amendments to the bill include provisions preventing the Fast Food Sector Council from requiring any new paid leave benefits for workers or from regulating how fast-food restaurant operators schedule workers’ hours. Under the new version of the bill, the minimum wage could increase to $22 per hour in 2023 and would be subject to inflationary increases in the future. The proposed law also includes a sunset date of six years, which would allow legislators to assess its effectiveness.

The FAST Recovery Act has not yet been signed into law by the governor. Ogletree Deakins will continue to monitor the bill’s progress and will post updates on the firm’s California blog as additional information becomes available.