With controversy surrounding exemptions granted to certain restaurants regarding the state’s new fast food minimum wage law, lawmakers passed another bill March 18 that will grant more exemptions if California Gov. Gavin Newsom signs the measure into law.
Assemblymember Chris Holden—author of the bill under consideration and the earlier proposal—Assembly Bill 1228, which was signed into law last year—looked to calm tensions lingering from pay-to-play allegations by some after a campaign donor to the governor was reported to be a beneficiary of a carveout in the law that exempts some bakeries.
“This was a process that was transparent, and like a lot of negotiations that happen around very difficult bills, they require both sides coming together and trying to figure out how to reconcile,” Mr. Holden said on the floor of the Assembly March 18 while bringing the new measure up for a final vote. “There was consensus between the business community and labor.”
He told colleagues the new bill is meant to clean up the previous measure by excluding restaurants in areas where employees have unionized and secured wages higher than the thresholds established by the law.
“This is a concern going forward because there’s a need not to be limited by the contours of AB 1228,” Mr. Holden said.
For example, he highlighted the $23 per hour wages plus benefits that casino workers have negotiated through unions, in addition to employees at the San Francisco airport and San Diego hotels where pay exceeds the new guidelines.
According to the text of the latest bill, the exclusions have been included because the restaurants operate in conjunction with larger enterprises, often subject to concession or food service contracts.
The bill also exempts restaurants located on land owned by the state, counties, or cities, including parks, beaches, and ports, among other sites.
One lawmaker questioned the rationale for exempting certain establishments and not others and said the policy is akin to picking winners.
“The underlying policy that we’re exempting from here is bad policy. If the policy is so just and so great, why are you exempting people and certain industries?” Minority Leader Assemblyman James Gallagher said while debating the measure before the vote was called. “Either the policy is good or it’s not, and it should apply to everyone equally.”
He also said the change could create potential economic uncertainty in the future by mandating higher wages for certain industries.
“And what we’re also going to see is more automation and the taking away of jobs that people rely on,” Mr. Gallagher said. “The cost of living that is already hurting families across the state is only going to get worse because of this policy.”
With questions swirling about reports of non-disclosure agreements used in negotiations between some labor unions while discussing the fast-food law last year, the assemblyman said more scrutiny is needed to ensure public knowledge of government dealings.
“We’re not going to let the governor drive the process. We’re not going to have negotiations in back rooms.” Mr. Gallagher said. “We’re going to do it in committees, and on this floor, and we’re going to pass just laws.”
Ultimately passed 57 to 5, with an urgency clause that expedited the process, the bill now awaits the governor’s decision. It passed in the Senate in February on a 31 to 4 vote.
The governor’s office declined to comment, citing its policy to not do so regarding pending legislation.
