California Fast-Food Bill Faces Industry Backlash, Says Unfair To Big Chains: Report

California Fast-Food Bill Faces Industry Backlash, Says Unfair To Big Chains: Report
  • Joe Erlinger, head of McDonald Corp's MCD the U.S. has criticized the California bill saying it unfairly targets big chains, CNBC reported.
  • Earlier this week, the California state Senate passed a bill to give a council the authority to raise the industry's minimum wage to $22 an hour for chains with more than 100 locations nationally and establish safety conditions.
  • California's current wage floor is $15.50 an hour.
  • Proponents of the bill say it will empower fast-food workers and help solve industry-wide problems such as unsafe working conditions and wage theft.
  • But the FAST Act faces strong opposition from the restaurant industry.
  • "It imposes higher costs on one type of restaurant while sparing another. That's true even if those two restaurants have the same revenues and the same number of employees," Erlinger wrote in a letter.
  • McDonald's was reportedly pushing its franchisees to lobby against the California bill. According to Citi Research, approximately 10% of McDonald's U.S. restaurants are in California.
  • Other restaurant companies have been fighting the bill, including Chipotle Mexican Grill Inc CMG, Chick-fil-A, Yum! Brands Inc YUM and Restaurant Brands International Inc QSR
  • "The FAST Act isn't going to achieve its objective of providing a better environment for the workforce; it's going to force the outcomes our communities don't want to see," said Michelle Korsmo, National Restaurant Association's president.
  • McDonald's Orlando photo via Wikimedia Commons.

Posted In: BriefsConsumer DiscretionaryRestaurantsGovernmentNewsRestaurantsLegalGeneral