On September 5, 2022, California passed Assembly Bill (AB) 257, titled the Fast Food Accountability and Standards Recovery Act, or the “FAST Recovery Act.” AB 257 establishes a Fast Food Council comprised of fast food employees, worker advocates, franchisors, franchisees, and government officials within the Department of Industrial Relations that would set industry-wide standards for wages, working hours, and other working conditions related to the health, and safety of fast food workers. The bill applies to fast food restaurants with 100 or more establishments nationwide.

AB 257, also prohibits fast food employers from discharging or discriminating, or retaliating against an employee for any of the following reasons:

• The employee made a complaint or disclosed information,or the employer believes the employee disclosed, or may disclose, information to the franchisor, to a person with authority over the employee, or to another employee who has the authority at the fast food restaurant to investigate, discover, or correct the violation or noncompliance, to the media, to the Legislature, or a watchdog or community-based organization, or a governmental agency regarding employee or public health or safety.

• The employee instituted, caused to be instituted, testified in, or otherwise participated in a proceeding relating to employee or public health or safety, or any council or Local Fast Food Council proceeding.

• The employee refused to perform work in a fast food restaurant because the employee had reasonable cause to believe that the practices or premises of that fast food restaurant would violate worker orpublic health and safety laws, regulations, any occupational safety and health standard, or any safety order of the division or standards board, or would pose a substantial risk to the health or safety of the employee, other employees, or the public.

Under the law, there is a rebuttable presumption of unlawful discrimination or retaliation if a fast food restaurant operator discharges or takes any other adverse action against an employee within 90 days following the date when the operator had knowledge of any of the employee’s actions above.

Before the end of the California legislative session, AB 257 was amended to remove a proposal to impose liability on franchisors for employment violations by franchisees.

Service Employee International Union president Mary Kay Henry was reported by Bloomberg News to have said, “the bill effectively offers another form of collective bargaining for fast food workers” and referred to the legislation as a “watershed moment.”  The International Franchise Association and other industry groups urged Governor Newsom to veto the legislation to no avail and are urging other states to steer clear of similar initiatives.

AB 257 takes effect on January 1, 2023.