Key Takeaways
- California’s ADDE Act requires restaurants with 20 or more locations nationwide to label the Top 9 allergens on menus by July 1, 2026, impacting national chains even if they have only one location in the state.
- Restaurants must disclose intentionally added allergens but are not required to report cross-contact risks, which some advocates see as a limited but important step toward transparency.
- Compliance will require significant operational changes, including menu redesigns, staff training, ingredient tracking and legal risk management, particularly for large or multi-unit operators.
- Even restaurants outside California should pay attention, as the law may influence future legislation, consumer expectations and brand reputation across the country.
California’s New Allergen Labeling Law and Its Impact on Restaurants
In a landmark move for food allergy transparency, California has enacted SB 68, the Allergen Disclosure for Dining Experiences (ADDE) Act, requiring restaurants to label major food allergens on their menus by July 1, 2026. The law, signed by Governor Gavin Newsom, is the first of its kind in the U.S. and is expected to reshape how restaurants communicate with diners, especially those with food allergies.
While widely supported by advocacy groups, the law introduces new compliance challenges and operational shifts for restaurants both within California and nationwide. Here’s what you need to know.
Who Must Comply
The law applies to restaurants with 20 or more locations nationwide, regardless of whether all locations are in California. This includes large chains and franchisees operating in the state. Smaller restaurants, food trucks and pop-ups are exempt from the requirement.
This broad scope means that even national brands with a single California location must comply, creating ripple effects across the country.
What Must Be Disclosed
Restaurants must disclose the presence of the Top 9 major allergens in their menu items:
- Milk
- Eggs
- Peanuts
- Tree nuts
- Fish
- Shellfish
- Wheat
- Soy
- Sesame
The law requires disclosure of allergens that are intentionally included in menu items. It does not require restaurants to disclose risks of cross-contact or allergens introduced during sourcing or manufacturing. However, many advocates view this as an important first step toward broader transparency.
Restaurants can choose to list allergen information directly on the menu, or provide it digitally (e.g., via QR code), as long as a printed version is available upon request.
Operational Impact for California Restaurants
The new law will require significant operational changes, particularly for large chains and multi-unit operators:
- Menu Updates – Menus will need to be redesigned to include allergen disclosures. For restaurants with frequently changing ingredients or seasonal items, this presents a challenge in maintaining accurate and up-to-date information.
- Staff Training – Front-of-house and kitchen staff will need training to understand allergen protocols, menu labeling and how to respond to customer inquiries. This is especially important for ensuring consistency across locations.
- Ingredient Tracking – Restaurants will need robust systems for recipe documentation and ingredient sourcing. This may require closer collaboration between culinary teams, procurement and compliance staff.
- Legal Risk – The California Restaurant Association has expressed concern about increased liability and the potential for predatory lawsuits. Static labeling could expose restaurants to legal action if allergen information is incorrect or outdated.
Implications for Restaurants Outside California
While the ADDE Act is a California law, its reach extends far beyond the state’s borders. For national chains and franchise operators, the legislation introduces new compliance responsibilities that hinge on whether they operate within California. Even for restaurants without a California footprint, the law signals a shift in consumer expectations and regulatory momentum that could influence future policies across the country. Understanding where your business fits into this landscape is key to preparing for what’s next.
If Operating in California
Any restaurant chain with 20+ locations nationwide and at least one location in California must comply. This includes franchisees, even if the parent company is based elsewhere.
If Not Operating in California
Restaurants without a California presence are not legally required to comply with the ADDE Act. However, the law sets a precedent that could influence:
- Future legislation in other states
- Consumer expectations around allergen transparency
- Brand reputation, especially for national chains
In short, proactive compliance, even outside California, may become a competitive advantage.
Lessons from the FASTER Act
Food allergy advocates are cautiously optimistic about the ADDE Act, especially in light of the unintended consequences of the FASTER Act, which took effect in January 2023. That federal law added sesame as the ninth major allergen requiring labeling.
In response, many food manufacturers—particularly in the baking industry—intentionally added sesame to products that previously did not contain it. This was done to avoid the cost and complexity of cleaning equipment to prevent cross-contamination. As a result, products that were once safe for sesame-allergic consumers became off-limits.
The ADDE Act avoids this pitfall by focusing on intentional ingredients, not cross-contact risks. Still, some fear that restaurants may respond in a similar way by removing allergen-friendly options altogether to reduce liability.
Strategic Considerations for Restaurant Operators
As the industry prepares for implementation, here are key strategic considerations:
- Vendor Partnerships – Restaurants may begin favoring vendors with robust allergen documentation and transparent labeling practices. This could influence procurement decisions and supplier relationships.
- Technology Adoption – Digital menu platforms and allergen management tools (e.g., MenuCalc, Foodini) are likely to become more widely adopted. These tools can help streamline updates and ensure consistency across locations.
- Brand Positioning – Restaurants that embrace allergen transparency may strengthen their brand reputation, especially among families and health-conscious diners. This could be a differentiator in a competitive market.
- Internal Collaboration – Marketing, culinary, legal and operations teams will need to work together to ensure compliance. This may require new workflows and cross-functional planning.
Consumer Perspective
From a consumer standpoint, the ADDE Act is a welcome step toward safer dining experiences. While it doesn’t address cross-contamination risks, it provides a baseline level of transparency that many diners with food allergies have long advocated for.
Organizations like the Asthma and Allergy Foundation of America (AAFA) have praised the law, noting that it empowers consumers to make informed choices and reduces the risk of accidental exposure
Challenges Ahead
Despite its benefits, the law presents real challenges:
- Cost of compliance may be high, especially for restaurants with dynamic menus.
- Legal exposure could increase, particularly if allergen information is incorrect or inconsistently applied.
- Implementation timeline may be difficult for smaller operators and franchisors with complex supply chains.
Some industry leaders worry that the law could lead to reduced menu options for allergy-sensitive diners, as restaurants seek to minimize risk.
Preparing for What’s Next
California’s new allergen labeling law marks a significant shift in how restaurants communicate with their customers. While it introduces new compliance burdens, it also offers an opportunity for restaurants to lead on transparency, safety and customer trust.
For restaurants operating in California, and those watching from other states, the next eight months will be critical. By investing in training, technology and cross-functional collaboration, operators can turn this regulatory change into a strategic advantage. For more information, contact Maggie Wise, Windham Brannon’s Restaurant Practice Leader.
