$20 Minimum Wage California Fast Food Reddit

A new law starts Monday that will pay most fast food workers in California at least $20 an hour. This will give more financial security to people who work in a job that has historically paid low wages, but it could also cause prices to rise in a state that is already known for having a high cost of living.

Legislators from the Democratic party in the state enacted the measure last year in part to recognize that a large portion of the over half a million fast food employees are not just teens looking for a little extra cash, but rather adults trying to make ends meet.

Immigrants like Ingrid Vilorio, who arrived in the US in 2019 and reportedly began working at a McDonald’s soon after, fall into this category. Up until last year, she worked full-time in the fast food industry. She currently has many jobs and works eight hours a week at a Jack in the Box.

“The $20 raise is great. I wish this would have come sooner, Because I would not have been looking for so many other jobs in different places.” Speaking via a translator, Vilorio said.

In the San Francisco Bay Area, Alex Johnson owns ten Cinnabon and Auntie Anne’s Pretzels businesses. He explained that in 2024, sales were down, so he had to fire his office workers and ask his parents for help with HR and payroll.

Johnson will lose around $470,000 annually due to pay increases. He announced that he would be increasing prices at his stores by 5–15% and that he would no longer be hiring or looking to create additional sites in California.

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$20 Minimum Wage

Most California workers now earn $16 an hour, thanks to a minimum wage increase that occurred over the past decade. At the time, many were worried that, as a result of the hike, their businesses would have to lay off some employees to cover the higher costs.

Michael Reich, a professor of labor economics at the University of California–Berkeley, argued that the opposite was true: that wages increased but employment remained stable.

I was taken aback by the lack of or difficulty in identifying repercussions of unemployment. Reich stated that, if anything, the employment consequences are favorable.

According to Reich, many of the state’s bigger communities have passed their own minimum wage legislation that establish rates higher than the state’s $16 per hour minimum wage. Because of this, the transition to $20 per hour will be less drastic for a lot of fast food joints.

Unions and the fast food business had been at odds for over two years about pay, benefits, and legal responsibilities, but they finally reached an agreement with the new law. Unions and businesses came up with the rule after secret talks, which included the uncommon measure of signing secrecy agreements.

Any restaurant in a national chain with 60 or more locations that provides minimal or no table service is subject to the law. Businesses that make and sell bread separately from other menu items, as well as restaurants located within grocery stores, are not subject to this rule.