California’s New “Woke” Laws Are Costing People Their Jobs

Recently, the federal government of the Golden State announced it would be raising the minimum wage to $20. Unfortunately, this has forced Pizza Hut to lay off the majority of its delivery drivers in the state.

According to reports, the new minimum wage will be in full effect across the state by April 1, 2024. But the law won’t have a positive effect on everyone in the fast food sector.

Additionally, it allows for potential annual wage hikes of up to 3.5% until 2029.

From 2025 to 2029, this council has exclusive authority to annually adjust fast food workers’ minimum wage, by either  3.5% or the annual change in consumer price index, whichever is lower. This provision expires in 2029.

Explaining this prediction, Anthony Zaller states “because the law does not apply to every employer across the state, the opposition to such legislation is much less.  And, of course, once the law is passed and has gained traction in one industry, it is easier for the legislature to expand the law to other industries.”

“PacPizza, LLC, operating as Pizza Hut, has made a business decision to eliminate first-party delivery services and, as a result, the elimination of all delivery driver positions,” the company wrote in a filed notice.

The two Pizza Hut franchisees behind the layoffs are PacPizza, LLC, and Southern California Pizza Co., Business Insider reports.

With nine years of driving experience, he expressed dissatisfaction with the severance offer, saying “The money they are giving us as severance pay is a slap on the face,” he continued “It comes to $3 a month for nine-plus years of service.” 

Due to the rise in minimum wage, Pizza Hut argues it can no longer afford its own delivery drivers.

However, customers can still add gratuity after the delivery is completed, the delivery app confirmed. These changes reflect a nationwide shift in the wage practices of the fast-food word.

The New York Times reports that as of July 2023, New York City set a precedent as the first U.S. city to mandate a minimum wage for app-based food delivery workers, nearly $18 per hour. By July 12, delivery apps were required to pay at least $17.96 per hour plus tips, increasing to $19.96 by 2025 and subsequently adjusting for inflation. 

He continued, “We should definitely put money in the community so everybody can survive. Everybody out here is having a hard time right now, and firing people isn’t the solution.”

This shift will lead to higher wages for employees who retain their jobs, but it will also contribute to a greater overall job loss.

Southern California Pizza Co., the other large franchise in the region, also announced they would be forced to cut over 800 employees from the payroll.

Chipotle and McDonald’s have both announced they’ll be raising the prices of various items on their menus to cope with the new regulations.

Speaking in the call, he said “Certainly, there’s going to be some element of that that does need to be worked through with higher pricing,” 

McDonald’s revealed that “strategic menu price increases” have contributed to a 14% increase in revenue but have also already raised prices nationwide due to rampant inflation. This includes an $18 Big Mac meal in Connecticut, as per the New York Post.

He anticipates an increase in the “mid-to-high single-digit” percentage range, citing the change in law as the primary reason for this adjustment.

“As for the people, if they’re going to raise the price, I’m still going to have to get it. So, we’re actually really suffering on the back end,” he said.

They report that McDonald’s executives revealed that a fewer number of Americans earning $45,000 or less visited McDonald’s branches in the last quarter of 2023.

Yet major players in the industry, including Taco Bell and KFC, have both refrained from commenting on the announcement of Newsom’s new legislation.

He began by claiming they are “aware of the recent changes to delivery services at certain franchise restaurants in California.”

Speaking at the event, Newsom also challenged the notion that fast-food jobs are merely for teenagers starting their careers, describing it as a “romanticized version of a world that doesn’t exist,” he continued, saying “We have the opportunity to reward that contribution, reward that sacrifice and stabilize an industry.”

The rep said, “Our franchisees independently own and operate their restaurants in accordance with local market dynamics and comply with all federal, state, and local regulations while continuing to provide quality service and food to our customers via carryout and delivery.”