Which restaurants have to pay $20 an hour?

The rate took effect on 1 April 2024 and still stands at $20.00. The hard part was never the number — it is deciding whether a given restaurant is covered, and the answer is not "we serve fast food".

Three conditions have to be true at once. The restaurant has limited or no table service, and customers order and pay before eating. It is part of a chain of at least 60 establishments nationwide — the count is national, so a chain with four locations in California and fifty-eight elsewhere is over the line. And it is primarily engaged in selling food and beverages for immediate consumption. Fail any one and the ordinary state minimum wage applies instead.

The exclusions are where operators get surprised in both directions. A restaurant that produces and sells bread as a stand-alone menu item can fall outside the definition. So can one operating inside a grocery establishment, or inside an airport, hotel, theme park, museum or similar venue. These are narrow, drafted carve-outs rather than general principles, and a business that assumes it fits one without reading the definition is making the same bet in reverse.

The rate is not fixed forever. The Fast Food Council may raise it once a year by the lesser of 3.5 percent or the change in the CPI, which means a covered employer has an annual date to check rather than a number to memorise.

Getting this wrong is not a small error. Coverage is decided at the level of the business, so a mistake applies to every covered employee for every hour worked since the effective date, and the underpayment carries the usual companions — the wage statement is wrong for the same period, and overtime computed from the wrong regular rate is wrong too.