A bill to create a fast food council within state government is raising questions about impartiality, transparency, and how high it could drive the price of meals that many California residents rely on.
AB 257 as written provides one side of a narrative, while the council structure raises concerns about equity, Tom Manzo, founder and president of the California Business and Industrial Alliance (CABIA), told the Northern California Record.
“The issue is you’re going to have this Fast Food Sector Council and it’s 11 unelected members, and the governor and Speaker of the Assembly are going to appoint these members, so potentially you're going to end up with a unionized, super-progressive Fast Food Sector Council,” Manzo said. “You might as well let the SEIU be in charge of it, and I think that would be the biggest red flag.”
According to the Assembly Floor Analysis, the Service Employees International Union (SEIU) of California is co-sponsor of the legislation, AB 257.
But Manzo noted there are concerns that only four of the 11 members would have any fast food experience, raising concerns about parity.
“So you potentially have seven people that could be the majority of the vote, with no fast food experience, who knows if they're all unionized people, determining minimum wages and maximum hours,” Manzo said.
The International Franchise Association states in the Assembly opposition argument that the bill is based on improper assumption.
“This misconception, which clearly serves as the underpinning of certain provisions proposed to be added by AB 257, is that the owner of the franchise brands – the ‘franchisors’ – actually own and operate the stores and make employment decisions for them. In reality, franchise establishments across the state are locally owned small businesses operating under a national brand or identity. The local business owners are in charge of all employment decisions, including hiring, firing, wages and benefits.”
Not everyone can afford the increased overhead costs that would come with the fast food council, Manzo said.
“Part of the problem is the Legislature just continues to make these kind of decisions, and they're really unchecked,” Manzo said.
The 2021 version of the bill was authored by then-Assemblymember Lorena Gonzalez, who resigned last month to take a leadership role at the California Labor Federation. Assemblymembers Chris Holden, D-Pasadena, Wendy Carrillo, D-Los Angeles, Evan Low, D-San Jose, Luz Rivas, D-San Fernando Valley, and several other legislators are now listed as sponsors of AB 257.
“Quite frankly, I think what’s going to end up happening is you're going to have people potentially not want to set up franchises, not want to expand in California,” Manzo said. “And how much more is our cheeseburger going to be for the average citizen because of the Fast Food Sector Council? Aren’t prices high enough on everything else? Who wants to pay $10 for a cheeseburger?”
The bill’s penalties also would be duplicative of provisions already in the California Labor Code, Manzo said.
AB 257, which did not pass last year, passed the Assembly by a vote of 41-21 on Jan. 31, and now goes to the Senate.