California Sets Highest U.S. Minimum Wage for Fast Food Employees — Comparing with Other States

fast food employee
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California’s Governor, Gavin Newsom, recently approved a bill, known as AB 1228 or the Fast Food Franchisor Responsibility Act, which sets the minimum wage for the state’s fast food workers at $20 per hour. This rate is notably the highest baseline wage for the industry across the U.S., as mentioned by Moneywise. The legislation specifically targets restaurants that have over 60 outlets nationwide, with an exception for establishments producing their own bread. Additionally, the law introduces a 10-member council to oversee fast food chains, with a mandate to provide wage guidelines and recommendations concerning work conditions.

The National Owners Association (NOA), which represents over 1,000 McDonald’s franchisees, voiced their opposition to this move. According to a memo they shared with Fox Business, the new law would impose an estimated yearly cost of $250,000 for each McDonald’s outlet in California. They emphasized that the existing business structures couldn’t bear these additional expenses. Moneywise noted that a substantial 95% of the 1,300 McDonald’s locations in California are owned and managed by local entrepreneurs.

Furthermore, the recent wage increment for fast food workers in California surpasses the state’s general minimum wage by nearly $5, setting it at $15.50, and it’s significantly higher than the federal minimum wage, which stands at $7.25. Based on data from Salary.com, the national average annual earnings for fast food employees are $24,424 as of the end of September. This average can fluctuate depending on the state or city, with workers in Monroe, Louisiana earning around $21,996 annually, and those in Washington, D.C. taking home about $27,189, a city with a $17 minimum wage for non-tipped employees.

Lastly, a statement from Governor Newsom’s office highlighted that fast food workers in San Francisco have an average yearly income of $30,530 as of September. However, this figure is expected to rise come April of the following year.

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