California has enacted Assembly Bill 1228 (AB 1228), which increases the minimum wage of fast food restaurant workers working at a national fast food chain establishment.
The details
Effective April 1, 2024, fast food restaurant workers working at a “national fast-food chain” establishment must be paid a minimum of $20.00 per hour. The minimum wage may be adjusted upward beginning on Jan. 1, 2025, but the annual increase will be limited to the lesser of 3.5 percent or the Consumer Price Index (CPI) as measured from the previous July 1 to June 30.
AB 1228 defines “national fast-food chain” as follows:
“National fast food chain” means a set of limited-service restaurants consisting of more than 60 establishments nationally that share a common brand, or that are characterized by standardized options for decor, marketing, packaging, products, and services, and which are primarily engaged in providing food and beverages for immediate consumption on or off premises where patrons generally order or select items and pay before consuming, with limited or no table service. For purposes of the definitions in this part, “limited-service restaurant” includes, but is not limited to, an establishment with the North American Industry Classification System Code 722513.
Exemptions
- Establishments operating a bakery that produces bread for sale as a stand-alone item on the establishment’s premises; and
- Restaurants located in a grocery establishment where the grocery employs the restaurant workers.
Next steps
Beginning April 1, 2024, “national fast-food chain” employers in California must pay their employees a minimum wage of at least $20.00 per hour.
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