Many are waiting to see what’ll come from the first-of-its-kind council that’s been formed to set fast-food wages and influence workplace conditions in California.
The most curious may be the council members themselves.
After a first meeting, they’re not sure what to expect for the second get-together, much less the two-per-year meetings that are mandated by law. As of late June, most were still in the dark about when that next get-together might take place. The general expectation is that it’ll be sometime in July. Only one could say she’d heard it’d be the second week of the month.
Conversations with several council members revealed a palpable frustration with what remains a monumental experiment for the restaurant industry and American labor relations in general. All said they volunteered with high hopes and an intention to affect the business for the better.
“It could be an effective tool to transfer semi-legislative authority away from a body of politicians to people who really know how to make a payroll,” says Richard Reinis, a practicing attorney and general counsel of the California Krispy Kreme franchisee Great Circle Family Foods. “As a businessperson, I would welcome that, that how we run our business has less interference from politicians.”
Yet those hopes weren’t exactly stoked by the first get-together. Now council members are wondering if the model will, or can, live up to its promise.
The Fast Food Council was founded on the notion that interaction among the diverse members would yield wages that are fair for both employers and employees, since both are represented on the panel (each side holds four seats, with a ninth and potentially tie-breaking vote wielded by an industry outsider). Yet communication between the participants has been largely non-existent by design. Indeed, it’s patently illegal.
The council is bound by a law that’s unique to California, the Begley-KeeneAct. It aims to avert backroom political deals—ironically, the very way the council came to be—by mandating that all state boards and commissions conduct their business entirely in view of the public.
For the council, that translates into no sharing of members’ email addresses, no Zoom calls between formal get-togethers, no casual meetings between more than two members and no issuance of a pre-meeting agenda. Everything before, during and after the meetings has to happen in the open.
“We can’t meet, we can’t talk on the phone with more than one person at a time? Not even a contact list?” remarks a clearly exasperated Reinis. “Why even have a panel? If we can’t build trust among the eight of us, I don’t see the point.” The chairman, longtime state Congressional aide Nick Hardeman, is intended to serve as a referee as well as a tie-breaker.
Without any advance information, Reinis didn’t know what to expect as he headed into the initial meeting. He came armed with a 20-point punch list of issues he intended to raise, 10 of them procedural, 10 addressing substantive issues. He also planned to ask Hardeman to initiate research on the state of California’s fast-food business.
Instead, he says, “the first meeting turns out to be nothing more than aggrieved employees recounting their abuse as employees. The meeting wasn’t very productive. For me, it shouldn’t be a platform from which political statements and howls be made.”
In Reinis’ estimation, it was less of a give-and-take than a hit-and-run.
He’s pushed back on the communication limits by meeting with stakeholders not on the panel, like officials of the Service Employees International Union‘s California operations. At one lunch, a leader of the union told him the whole purpose of the council’s formation was “‘proof of concept.’ That was her exact quote,” Reinis says. “She’s not concerned with what comes out of it,” as long as the perception is positive.
The idea is to transplant a workable model to other areas and establish what’s known as sectoral bargaining—having a group with labor representation set the wages for a whole business segment—as a standard.
So far, candid give-and-take between council members has been an elusive goal. Maria Maldonado, a restaurant worker and SEIU organizer, volunteered to serve on the panel because she believes it would foster conversation between workers and employers, with both parties benefitting from the broadened perspective.
She foresaw less of a cage match between the traditional adversaries than a United Nations-like effort to meld competing agendas into a compromise all could live with.
“Before the first meeting, I was asked if I was willing to talk to the employers,” says Maldonado, a Jack in the Box veteran and one of the labor representatives on the council. “I thought we could be reasonable. We hoped we could be able to talk. I hoped they’d be able to listen, and that we’d listen.”
Angelica Hernandez, a McDonald's cook-trainer who holds one of the council’s labor seats, was a little more apprehensive. But “I didn’t go in afraid, because I had other fast-food workers with me,” she said through an interpreter provided by SEIU. “I came in with my head up high because they [employers] couldn’t step all over us. They may make more money than we do, but we have more numbers. We have power.”
Yet, all stressed, conversations between employer and employee didn’t happen during the first meeting, which was streamed live. Part of that was its nature as the kick-off event; the members didn’t even know one another.
Yet Maldonado and several of the other interviewees voiced optimism for a true back-and-forth during Meeting No. 2 and the ones that follow, delivering on the council’s promise. “It’s the reason to have the council,” she said.
To foster that conversation, Maldonado would like the meetings held monthly instead of merely twice a year, via Zoom if not in person, so the conversations can be ongoing and can focus on issues that suddenly erupt in the business, like the heat wave that pushed kitchen temperatures to dangerous levels in June.
She notes that much of the buzz that’s been triggered by the council focuses on the body’s pay-setting powers and the leap in the minimum wage that came with its creation. Under a compromise struck between fast-food chain representatives and organized labor, the employers were mandated to pay at least $20 an hour as of April 1, about a 25% increase from the day before.
Maldonado voices hope the group won’t neglect its responsibilities of monitoring the working conditions of fast-food workers in the state. As part of the compromise that created it, the council can only recommend changes in workplace requirements and standards, rather than dictate them, as its founding law initially stated.
In particular, she’d like the group to devote attention to protecting employees not just from heat, but also violent crime and workplace accidents. She noted how the employee of one quick-service brand in the state was electrocuted. Others saw their workers struggling to afford gas for their cars. Why not share solutions so fewer suffer in those ways?
“Maybe I’m being idealistic, but I think we can come up with some solutions,” says Maldonado.
Hernandez would like the brainstorming to extend to scheduling. “Why? Because sometimes the schedules are not fair,” she says. “I have worked in my restaurant for 20 years, but I see better schedules sometimes going to workers with less time.”
Still, there’s a consensus that wage increases will be the default topic in future meetings. Under the law that created the council, the minimum wage for most fast-food workers could increase annually by 3.5% or the change in the cost of living, whichever is lower. The hike requires only a simple majority vote to be adopted, and labor holds four of the five votes needed.
Two of those four reps, Maldonado and Hernandez, say they’ll support a hike. “Yes, we won $20 an hour, but that is not enough for living in California,” says Hernandez.
The SEIU, through a newly formed affiliate called the California Fast Food Workers Union, has also aired support for raising the wage by the maximum amount in 2025.
Reinis wants to see what happens at upcoming meetings before making any decision on wages. “Keep in mind that wage increases are permissive. They’re not mandated,” he says.
The whole arrangement has been seen as an encroachment on fast-food employers’ traditional ability to base wages on their P&Ls and the state of the labor market.
“This is scary to a lot of restaurant operators,” says Reinis. “They see their employees as members of a union, even though they’re not members of the union.”
Instead of deciding unilaterally what employees would earn, they’ll now be mandated to pay at least what the Fast Food Council dictates, and that decision could be based on lifestyle considerations as much as economics. Are wages sufficient to enable workers to buy a car? Or rent an apartment in an area with better schools? How about the pay gap between executive and frontline worker?
Reinis isn’t put off by that updated way of setting pay.
“My thought is, look, let’s try to get consensus here,” he says. “I’m a human being, I believe in the dignity of our workforce. I’ve made 200 speeches about the dignity and consideration our employees deserve, and not playing to greed.”
SG Ellison, CEO of Taco Bell and Arby’s franchisee Diversified Restaurant Group and another employer rep on the council, told the audience at Restaurant Leadership Conference that he similarly sees a welcomed opportunity to do better by employees. “The reason that I joined is, no one is more concerned about our employees than me,” he said. He did not respond to a request to be interviewed for this story.
The participants voice hopes the next session will be more of a true forum for discussing the challenges fast-food employees and employers face and how they can work together on those concerns.
“Hopefully they will listen to the workers, because they could learn so much,” said Maldonado. “I really believe they can listen, and they can open up. If you’re a good employer, you want to have a good industry.
“I believe in that,” she stresses. “I’m going to do everything in my power to make it work.”
Hernandez also still believes in the model’s promise of getting employer and employee to work on big industry issues together for the benefit of both parties. “When we would speak with our managers or supervisors, they wouldn’t listen to us. They ignored us,” she said. “Now we can sit at the table with their bosses.”
Michaela Mendelsohn, an El Pollo Loco franchisee and another employer representative on the council, matches the worker reps in their optimism. “I’m hopeful it can be a positive forum where the interests of all sides can be discussed and understood,” she said in an email to Restaurant Business.
Reinis is less committal. Can it be a better way? “The answer to that is nuanced,” he says. “All of the stakeholders will look at it and say positive things—and have different answers.”
He contends the chances of success rest largely on Chairman Hardeman, whose day job is serving as chief of staff for state Senate President pro Tempore Emeritus Toni Atkins, a stalwart of California’s Democratic Party. He’s the only one who’s steeped in the governing process. For the other eight council members, “We’re in this semi-political arena where many of us are new to what you need to do politically,” Reinis said.
Hardeman declined a request to be interviewed for this story.
“It can work for one year,” says Reinis. But can it work for the next four, the lifespan set for the council by the law creating it?
There are a lot of if’s to that one, he says.
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