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California fast-food workers to see a $20 minimum wage

Starting April 1, some 550,000 fast-food workers in California will have one of the highest minimum wages in the nation. KPBS North County reporter Alexander Nguyen looks at the impact of the pay increase on workers and the economy.

Starting April 1, some 550,000 fast-food workers will make a minimum wage of $20 an hour — higher than the state's $16 minimum wage.

It's also one of the highest minimum wages in the nation. The Service Employees International Union (SEIU) called it a culmination of 10 years of work.

The higher minimum is a result of Assembly Bill 1228, signed into law last September by Gov. Gavin Newsom. It also created a Fast Food Council, comprising fast-food industry representatives, franchise owners, workers, union representatives, and a member of the public. The council is authorized to raise wages by a maximum of 3.5% a year through 2029.


Maria Maldonado, a field director of the California Fast Food Workers Union and a member of the Council, said it's about giving the power back to workers who have been exploited for too long.

“They want not only $20 but also a seat at the table," she said. "A lot of people are talking about $20, but it’s not the only goal for workers. It’s to improve the conditions.”

Not all fast-food workers will see a pay increase. The law only applies to national fast-food chains with 60 or more locations. It also excludes chains with bakeries, such as Panera, and restaurants within grocery stores.

But the industry is also pushing back, saying it could force some franchisees to close their doors.

Maldonado doesn't think that will happen.


"When the minimum wage went up in 2015 with $15, the corporations were saying like we’re gonna go broke or (franchisees), right?" she said. "And that didn’t happen.”

University of San Diego economics professor Alan Gin said there might be some price increases, but overall, workers will be better off.

“The restaurant industry might raise their prices to counteract in this higher minimum wage," he said. "But in the overall grand scheme of things, I think that would be minimal, in terms of the overall cost of living.”

Darin Haris, CEO of Jack in the Box, headquartered in San Diego, told investors during a recent earnings call that the company could increase their menu prices between 6% to 8%.

For workers like Sergio Valderrama, who works at McDonald's in Del Mar, the extra pay means he could work fewer hours and spend more time with family.

"Maybe finish around 10 p.m. or 11 p.m., instead of three o'clock in the morning like I usually do, and maybe take a day here and there so I can actually spend it with my family or with my kids,” he said.

Valderrama said it's a myth that fast-food jobs are for teenagers looking for some spending money.

“They're hiring regular people that need to earn a living like me," he said. "I don't go to school anymore, so I'm not here for a part-time (job). I'm here so that I can actually make some money to bring home and pay for bills, food, and everything else. Basically, my everyday living.”

According to California's nonpartisan Legislative Analyst's Office, roughly 10% of low-wage workers are the sole breadwinner with children.

At the minimum wage of $16 an hour, a full-time worker makes roughly $32,280 a year, well below the state’s poverty line of $39,990 for a family of four.

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