The status quo is killing the fast food industry

Just like its impact on the whole catering sector, the pandemic has ravages in the fast food sector. A February poll of U.S. restaurant owners, including fast food outlets, found that 50% of respondents identified employee recruitment and retention as their major challenge for 2022.

Why is it so difficult? Because the fast food industry needs to take better care of its workers. Fortunately, new legislation circulating in the California Senate could help the industry save itself.

The fast food industry is famous for low pay, poor benefits, unsafe working conditions, and a corporate structure that makes it very difficult for franchisees to improve conditions. Even before the pandemic, turnover was high and many workers said they were subjected to illegal working conditions – like being forced to do work after hours or working in unsafe conditions.

Today in California, the situation is much the same. According to the United States Bureau of Labor and Statistics, many areas of California have a high employment rate fast food and counter workers. Many of these workers are women and come from black and Latino communities that were already the most negatively impacted by the pandemic, earning roughly the lowest wages in the state. And their working conditions are no better.

At a Jack in the Box near Sacramento, for example, workers have gone on strike several times after being robbed of wages, forced to work after testing positive for the coronavirus and even face threats that management would call U.S. Immigration and Customs Enforcement on militant workers. In February 2021, the California Labor Commissioner Posted a $125,913 citation to a Los Angeles McDonald’s franchisee after it discovered the employer unlawfully fired four workers who reported unsafe working conditions during the pandemic.

More franchisees have low profit margins and little aptitude to profitably improve compensation on their own due to the terms of their franchise agreements with major brands, which deepens the challenges in the industry.

It’s here that the rapid recovery law, or AB257, comes into play. Having already passed the Assembly in January, the bill, if passed by the Senate and signed by Governor Gavin Newsom, would provide fast-food workers with a platform to discuss wages and possibly improve working conditions standards across the industry through the creation of a first statewide fast food industry council.

The council would bring together all key players, including workers, state regulators, franchises and their parent companies, to investigate working conditions and make recommendations on safety, schedule stability, training and minimum wage for the whole industry. The Fast Recovery Act would also make franchises and their parent companies more accountable to labor laws.

It’s important to address a range of standards rather than a single issue like salaries, because challenges like turnover, scheduling practices, and security are often interrelated. Setting industry-wide standards ensures that similar work receives similar pay, allows all companies to compete on a level playing field, and is especially helpful in closing racial and inter-racial pay gaps. the sexes.

Although sector councils were not commonly used in the later part of the 20th century, there has been growing interest in them and other similar policies in recent years. Since 2018, three local governments – Seattle, Philadelphia and Detroit – and four states – Colorado, New York, Nevada and Michigan – have laws enacted to include workers and employers in the process of recommending or implementing workplace standards for an entire sector. These laws mainly focused on agriculture, home care and domestic work. But other states and sectors are considering implementing their own versions — such as bills to establish industry-wide standards for nail salon workers in New York and nursing home workers in Minnesota.

Some opponents of the bill say the Fast Recovery Act will give too much power to the sector council and drive fast-food chains out of California. But continuing business as usual is a losing strategy for an industry that is in a crisis of its own making. In addition, to research showed that when workers are placed in a continuous formalized role within a compliance body, it strengthens the enforcement of labor standards. This is exactly what the fast food industry needs if it is to attract and retain the workers it desperately needs.

California has long been at the forefront of workers’ rights and protections, including becoming the first state to enact a $15 minimum wage in 2016 – a breakthrough that paved the way for states across the country to they take similar action.

With the Fast Recovery Act, California has another opportunity to demonstrate to the country how government, workers and private businesses can work together to effectively meet the needs of workers, to solidify the national momentum to include workers and employers in setting up the industry. broad standards and ultimately save an industry in dire need of reform.

David Madland is the author of
“Reunion: How Bold Labor Reforms Can Fix, Revitalize, and Unify America” and is a senior fellow at the Center for American Progress.

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