California is witnessing a wave of job losses in the fast food industry as
the state prepares to implement a new minimum wage of $20 per hour next
week. According to a report from The Wall Street Journal, many
restaurants, particularly pizzerias, are making significant cuts in
response to the impending wage hike.

This move is anticipated to result in the elimination of hundreds of jobs,
reduced working hours, and a freeze on hiring across multiple
establishments. The Fast Act, signed into law by Democratic Governor Gavin
Newsom in September, mandates fast food chains with 60 or more locations
nationwide to comply with the wage increase.

The legislation, championed by labor unions and the healthcare industry,
aims to uplift workers� earnings. Governor Newsom emphasized the
significance of the new law, noting that it would impact 80% of the
workforce.

Layoffs in the fast food sector began as early as last year, with Pizza
Hut being one of the prominent chains announcing significant cuts. More
than 1,000 delivery drivers are slated to lose their jobs in California,
while some franchises have opted to discontinue delivery services
entirely.

�Where select California franchisees have elected to make changes to their
staffing approach, access to delivery service will continue to be
available via Pizza Hut�s mobile app, website, and phone ordering, and the
customer ordering experience will remain consistent,� a Pizza Hut
spokesperson told USA TODAY Wednesday.

Excalibur Pizza, a Round Table Pizza franchisee, plans to eliminate 73
driver positions, constituting 21% of its workforce, in April. �The
franchisee is transferring their delivery services to third-party. While
it is unfortunate, we look at this as a transfer of jobs,� a company rep
told USA TODAY.

�As you know, many California restaurant operators are following the same
approach due to rising operating costs.� Despite efforts by some
businesses to circumvent the wage increase, Newsom�s administration has
emphasized that there will be no exemptions.

Greg Flynn, who holds a monopoly over Panera franchises in California,
attempted to exploit a loophole by claiming that restaurants producing in-
house bread would be exempt from the mandate. However, Newsom�s office
refuted this assertion, affirming that no exemptions would be granted.

Chipotle and Starbucks, two major players in the fast food industry, have
acknowledged the need to adjust their operations to comply with the new
minimum wage.

Chipotle�s CFO indicated that the company would likely raise prices to
offset the increased labor costs. Meanwhile, Starbucks, which recently
closed several stores in California, has committed to a minimum 3% wage
increase, effective January 1st.

The impact of California�s $20 minimum wage extends beyond fast food
chains, affecting various businesses categorized as �fast food
restaurants� under the law. As the state moves towards implementing the
wage hike, stakeholders are grappling with the economic ramifications and
seeking ways to adapt to the new regulatory landscape.

In conclusion, the impending $20 minimum wage in California is prompting
significant changes in the fast food industry, including job losses and
operational adjustments. While the wage increase aims to improve workers�
livelihoods, its implementation poses challenges for businesses and raises
questions about its long-term implications.

https://gistfest.com/california-fast-food-workers-are-losing-their-jobs-
as-minimum-wage-law-take-effect-2/