Why Are California Fast Food Workers Demanding Another Wage Hike?

Fast food workers in California are demanding another minimum wage hike, just months after their pay was raised from $16 to $20 an hour. The California Fast Food Workers Union, part of the Service Employees International Union (SEIU), presented their demands at the inaugural meeting of the state's Fast Food Council.

The union is requesting that wages be increased to $20.70 per hour by January 1, 2025, to address the rising cost of living. In a statement, the SEIU emphasized the need for increased job stability, fair payment of owed back pay, stable schedules, and a thorough investigation into alleged "pervasive abuses" in the fast food industry. These abuses include wage theft, harassment, discrimination, and hazardous working conditions.

"As California’s fast-food industry grows, cooks and cashiers are doubling down on their fight across the state to win safe and healthy stores, stable hours, pay that keeps up with inflation, and training to understand their rights on the job," the SEIU stated.

Governor Gavin Newsom established the 11-member Fast Food Council in September 2023 to set wages and regulations for the industry. Four months ago, the state's new $20 minimum wage increase took effect. Since then, fast-food restaurants in California have cut nearly 10,000 jobs as franchises struggle with higher labor costs and increased prices.

Major chains like McDonald’s, Burger King, and In-N-Out Burger have raised prices to offset the wage increase, leading to reduced employee hours and a push towards automation. Rubio’s California Grill closed 48 of its 134 locations, citing the "rising cost of doing business" and filing for bankruptcy in June.

Jot Condie, President and CEO of the California Restaurant Association, noted that businesses are also grappling with rising rents and food costs. "When labor costs jump more than 25% overnight, any restaurant business with already-thin margins will be forced to reduce expenses elsewhere," Condie told KTLA 5 News. "They don’t have a lot of options beyond increasing prices, reducing hours of operation, or scaling back the size of their workforce."

Fast food joints have expressed concerns about these rising operational costs to the council. An Arby's franchisee shared that they have had to raise prices and dip into personal savings to sustain their business. "I try to do the best I can. I have taken money out of my own savings to make things work this last quarter. But I don’t know how long I’ll be able to sustain something like that moving forward," they said.

Consumers have also felt the impact of the new law, with 78% now considering fast food a "luxury" purchase due to increased meal prices, according to a survey by LendingTree.

Despite these challenges, the SEIU and Newsom’s office highlight data showing that the industry added thousands of jobs after the wage increase took effect on April 1. Employees not affected by layoffs are supporting the new wage hike demand. "It’s been really good because I can put more food on the table and in my fridge and pay my rent on time which was always a challenge," said Romualda Alcazar Cruz, an Oakland Wendy’s employee.