California is raising the minimum wage of fast food employees from $16 to $20 under the FAST Act. I have explained that raises to California’s minimum wage was restricted due to successful lobbying efforts on behalf of fast food establishments. The new law does include commercial fast food restaurants, excluding Panera Bread. Why?
Fast food lobbyists spent $4 million in the first six months of this year to prevent the California Accountability Bill from passing. The bill would hold franchisees and their parent companies jointly liable for the treatment of workers. California Governor Gavin Newsom claimed that minimum wage jobs were not meant for students of people looking to gain employment experience. “That’s a romanticized version of a world that doesn’t exist,” Newsom said. “We have the opportunity to reward that contribution, reward that sacrifice and stabilize an industry.”
A fast-food bill was passed in September 2022 that set the minimum wage to $22 per hour for select chains with over 100 locations, later expanding to a $20 minimum pay for restaurants with 60 locations. Now California is specifically exempting fast food establishments that contain bakeries, such as Panera Bread. Why are restaurants that sell bread above the law?
The answer is that politicians are always up for sale to the highest bidder. Glenn Flynn is the largest fast food franchise owner in America with an empire of 2,600 restaurant locations that produce around $.45 billion in sales. Flynn, estimated to be worth around $1.1 billion, has strongly supported Gavin Newsom publicly since 2014, when Newsom was a lieutenant governor. Both men attended the same high school and have longstanding ties.
Bloomberg reported that Flynn donated $64,800 to Newsom’s personal re-election campaign and an additional $100,000 for conservative-led recall efforts. Flynn’s holdings in California only include two establishments – Applebee’s and Panera Bread. Applebee’s is exempt from the law despite its pre-frozen dishes since it is a sit-down restaurant chain. Panera Bread, on the other hand, is exempt due to this specific loophole that only excludes establishments that bake bread. This is what happens when lobbying is permitted and politicians are for sale.