On September 5, 2022, California’s Fast-Food Accountability and Standards Recovery Act (“FAST”) was signed into law. In a state government where union-friendly politicians, lobbyists and influencers exert powerful influence, a 10-member Council is to be designated (and not elected) from a select group that expressly includes “union activists.” The Council is authorized to set minimum wages and other working conditions for fast-food workers with one significant caveat: the Council’s jurisdiction extends only to non-unionized fast-food restaurants. As non-unionized restaurants come under the Council’s FAST assault, how long will it take before franchise owners conclude that accepting unionization is a matter of survival even if affected employees might choose differently under normal NLRA election procedures guaranteeing the right to vote “No”? One must ask whether this is the real and unsubtle point of FAST.
Just before the New Year, a group called “Save Local Restaurants” sought to block FAST’s imminent implementation pending a determination that sufficient signatures were obtained to support the referendum petition. More than a million signatures supporting the referendum were garnered, subject to verification. In such cases, enforcement of the law is normally paused until signature verification is completed.
Underscoring the bias that the political order harbors against the stubbornly non-union fast-food restaurant industry, the government announced that it is pushing forward with FAST implementation despite the Referendum petition. As reported by the Wall Street Journal, “…[n]ever in the state’s 111-year history of referenda has a law been allowed to ‘temporarily’ take effect once a referendum petition has been filed….”
FAST is clearly a blatant effort to coerce non-union fast-food franchisees to force their acceptance of worker union representation as the law exempts union shops from the over-reach of the 10-member Council. Non-union employers face an immediate minimum wage increase to an unprecedented $22/hour. Additionally, such employers will be exposed to lawsuits brought by members of the Plaintiffs’ Trial Bar as they are expressly encouraged to enforce the law as “private attorneys general” in exchange for the award of attorneys’ fees and punitive damages.
FAST’s lack of fairness and blatant partisanship raises many constitutional issues which lurk in the provisions of the new law. For example,
• Does FAST violate the equal protection clauses of the state and federal constitutions?
• Does FAST deprive franchise restaurants of due process?
• Is FAST an unconstitutional delegation of governmental authority to non-elected officials?
• Does FAST hamper the flow of interstate commerce in violation of the U.S. Constitution?
• Does FAST’s obvious union favoritism interfere with workers’ Section 7 rights under the NLRA? Are the elements of union interference imbedded in FAST amount to unfair labor practice under federal law?
These are only a few of FAST’s many questions that will, undoubtedly, be explored in anticipated litigation. There will be many significant legal challenges starting with the challenge to the Referendum.
Mandelbaum Barrett PC is proud to represent and serve the New Jersey Hospitality Industry, and we stand ready to review the implications of FAST with you. Members of the New Jersey Hospitality Industry should understand the “me too” reality of what happens to employment laws first passed in California. How much later will it be before the New Jersey and New York legislatures jump on the FAST bandwagon if the law survives anticipated challenges?