New York, Calif. Bills Would Give Nonunion Workers More Say

A recent emergence is taking place for a novel legal framework that allows employees in largely nonunion industries a say on their job conditions as members of policymaking councils with lawmakers in California and New York mulling proposals covering, respectively, the fast food and nail salon industries.

The labor backed A.B. 257, also known as the FAST Recovery Act, is headed to the California State Senate after the Assembly narrowly advanced the measure on Jan. 31. On the opposite coast, labor-friendly lawmakers in New York are pushing the newly introduced Nail Salon Minimum Standards Council Act.

These measures are exciting labor advocates eager to give these low-wage workers more power in their workplaces and worrying employer groups, which say they threaten to stifle business.

“These new sectoral standards boards are really promising strategies for attacking the poor wages and working conditions that we see in ‘sweatshop industries’ like fast food and nail salons,” said Paul Sonn, state policy program director at the National Employment Law Project, a worker advocacy group. “What I think is really exciting about them is they invite workers who are experts on their workplaces into the process of designing solutions for them.”

A.B. 257 was introduced in the California State Assembly in January 2021 by then- Assemblywoman Lorena Gonzalez, the lawmaker behind a similarly divisive 2019 measure that made it harder for employers to classify workers as independent contractors.

The measure has the stated aim of addressing low pay, poor benefits and job security, and other issues in the fast-food industry by giving these "workers with inadequate means to amplify their voices and their experience" more input on their job conditions. It does so in two main ways.

First, the act would create an 11-member "Fast Food Sector Council," appointed by state officials and composed of workers, worker advocates, public officials and business representatives, to set certain minimum standards for the state's fast-food industry. The measure would also hold franchisors jointly liable for franchisees' labor violations.

The New York measure, introduced last month in the State Senate and Assembly, is similar. Declaring that some nail salon workers face "wages and standards insufficient to provide adequate maintenance and adequate health protections for themselves and their families," the bill aims to create a 15-member policymaking council likewise comprising state officials, workers, and public officials.

These parallel measures are part of ongoing efforts by labor groups and worker advocates to give workers more sway over conditions in these diffuse industries, where organizing in individual workplaces has had little effect on broader standards. A.B. 257's primary champion is the Service Employees International Union, which is also behind the Fight for $15 and a fast-food organizing initiative.

The New York act's main backer is the New York Healthy Nail Salons Coalition, which is led by worker groups including Adhikaar, a worker center serving Nepali immigrants, and the local joint board of Workers United, another SEIU affiliate. The group previously secured state orders requiring salons to post fliers detailing workers' rights and ending the subminimum wage within the industry, but these measures don't go far enough, coalition director Daisy Chung told Law360.

"We can't do it piece by piece," Chung said. "What folks really want to do with this bill is just build a new foundation for the industry and how it operates."

The New York measure has yet to draw the attention of the business community, while employer advocates have come out in force against California's A.B. 257.

International Franchise Association vice president of state and local government relations Jeff Hanscom called the measure "one of the most damaging pieces of legislation we've ever seen for the franchise business model."

Along with the National Restaurant Association, the IFA is leading a business coalition that's urging lawmakers to vote no on the legislation. Hanscom said his group has concerns about the breadth of the council's mandate — it can set rules on pay, safety and working conditions "as reasonably necessary" to protect worker welfare — and its unelected members' lack of accountability. An amendment giving the legislature 60 days to review the council's decisions is not a meaningful guardrail, he added.

"It's hard to think of a time when a legislative body has taken substantive action in 60 days," he said.

Michael Lotito, the co-chair of management-side employment boutique Littler Mendelson PC's Workplace Policy Institute, said the measure is the "antithesis" of franchising because it would erode the independence intrinsic to the model. If franchisors are liable for franchisees' errors, they'll take more local control, turning owners into "nothing more than managers," he said.

"If this is successful with regard to fast food, it's only a matter of time before [organized labor and progressive allies] will try to do similar things with regard to other industry segments," Lotito said.

A little over a year after its introduction, the California bill is moving forward. The measure fell short in an initial vote on the Assembly floor in June by a 38-27 tally, three votes shy of the 41-member majority needed to clear the chamber. It hit that mark in late January, advancing to the Senate.

Hanscom said he expects a close vote in the Senate, which consists of 31 Democrats and 9 Republicans, a similar split to that of the Assembly. The coalition "will leave no stone unturned" through the end of the legislative session on Aug. 31, he said.

April Verrett, the president of SEIU Local 2015 in California and the co-chair of the national union's organizing committee, said the union is buzzing in the wake of the Assembly vote and optimistic it can get the measure to the governor's desk.

Meanwhile, this attention is driving interest elsewhere in similar measures to give nonunion workers more say on the job, Verrett said.

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