Overview of California’s AB 1228 Fast-Food Regs

Oct 9, 2023 | Finconomics 101, No Bull Economics

California is very concerned about protecting fast-food workers. Where is this sentiment for employees in other retail businesses? This legislation perfectly depicts how big brother can run amuck with a poorly conceived & biased exercise of power… 


  • California’s AB 1228 legislation, passed on 9/28/23, created a “council” tasked with the establishment of fast-food restaurant minimum standards on wages, working hours, and other working conditions adequate to ensure/maintain the health, safety, & welfare of fast-food restaurant workers.
  • The appointment of the council is a sterling example of democracy. California’s Governor gets to appoint 7 of the 9 voting members to serve 4-year terms while the Speaker of the Assembly & the Senate Committee on Rules shall each appoint one representative.
  • Notably, this legislation only pertains to “National fast-food chains” with more than 60 establishments nationally that share a common brand. Not 59, not 58 – just 60 or more!
  • However, there are exceptions to this rule: “fast-food restaurant” shall not include an establishment that on September 15, 2023, operated a bakery that produces for sale on the establishment’s premises bread. Also, if a restaurant is located & operates within a “grocery establishment” then the restaurant shall not be considered a fast-food restaurant.
  • Here is the best part: the hourly minimum wage for fast food restaurant employees shall be twenty dollars ($20) per hour, effective April 1, 2024. Thereafter, the council may establish minimum wages for fast-food restaurant employees that take effect on an annual basis, beginning on January 1, 2025.
  • The hourly minimum wage established by the council may increase on an annual basis by no more than the lesser of the following: (i) 3.5%; or (ii) the rate of change in the Consumer Price Index for Urban Wage Earners and Clerical Workers (U.S. CPI-W).
  • Maybe the council could explain the purpose of California’s $15.50/hr. minimum wage? Beyond the absurdity of an unequal $20/hr. fast-food minimum wage, this legislation introduces competition for all retailers around this pay level. Maybe this represents a backhanded way for California to continue hiking the minimum wage that increased +50% since 2017?   
California Minumum Wage Chart

Sources: https://leginfo.legislature.ca.gov/faces/billTextClient.xhtml?bill_id=202320240AB1228; Minimum Wage Frequently Asked Questions (ca.gov)

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