UPDATE: Jan. 17, 2023: On Friday, a California judge prohibited the California Department of Labor’s effort to implement elements of the FAST Recovery act while the secretary of state verifies the signatures on a referendum petition, court records show. The injunction is a victory for the industry group opposing the fast food council bill because it bars the council from operating until the law is approved by a referendum in November 2024, or unless the secretary of state finds the industry coalition backing the referendum did not submit sufficient signatures to trigger the referendum process. 

Dive Brief:

• A temporary injunction granted by a California court has blocked the California Department of Industrial Relations from implementing the FAST Recovery Act while the state verifies petition signatures gathered by Save Local Restaurants to trigger a referendum that could overturn the law.
• On Dec. 27, Katrina Hagen, director of California DIR, wrote in a letter to opponents of the law that her office had a legal duty to implement the FAST Recovery Act until the California Secretary of State certifies the referendum.
• Save Local Restaurants, an industry group funded by major national brands, sued to stop Hagen on Dec. 29. A California judge granted a temporary restraining order against Hagen and the DIR. The restraining order prevents the implementation of the fast food council law at least until a court hearing on the suit scheduled for Jan. 13.

Dive Insight:

The California Secretary of State has not yet finished verifying petition signatures for a referendum to challenge the FAST Recovery Act. On Dec. 27, Hagen wrote in her letter that unverified signatures are not sufficient reason to stop a law passed by the legislature from taking effect.

“Our elections laws set out a process for signatures in support of placing a referendum measure on the ballot to be verified before the Secretary of State may certify that a referendum is qualified for the ballot,” Hagen said in a statement. “If and when the referendum challenging AB 257 qualifies for the ballot, the law will be put on hold.”

Judge Shelleyanne Chang cited the short time between the Save Local Restaurants’ suit and the implementation of the law, which would have begun Jan. 1, in the temporary restraining order halting the law.  The restraining order halted the implementation of the law, which would create a 10-member council composed of labor, business and government representations to regulate working conditions at fast food brands operating in California with more than 100 locations nationwide. 

The FAST Recovery Act was signed into law in September by California Gov. Gavin Newsom, but has faced heavy criticism by the restaurant industry. A survey by Homebase revealed 40% of California operators were concerned that they would lose workers to QSRs which may have to pay employees more under the law.