In a stark example of the unintended consequences of government overreach, more than 1,200 Pizza Hut delivery drivers in California are set to lose their jobs in the wake of the state’s fast food minimum wage increase. California’s decision to hike the minimum wage for fast food workers to $20, a move championed by Democratic Governor Gavin Newsom, has forced numerous Pizza Hut franchises to cut delivery driver positions. Instead, they will turn to third-party delivery services like DoorDash, GrubHub, and Uber Eats, as reported by CBS News. This drastic change will primarily impact drivers in Los Angeles, Orange, and Riverside counties, starting in February.
Pizza Hut To Lay Off Over 1,200 Workers In California As State Raises Fast Food Minimum Wage To $20 An Hour https://t.co/KRnaSdmKS2 pic.twitter.com/ANCNDKw9y0
— Daily Wire News (@DailyWireNews) December 27, 2023
The decision, a direct result of Assembly Bill 1228 which saw a 30% increase in fast food worker minimum wage, was signed into law by Governor Newsom in September. This legislative action has prompted other fast food chains, including McDonald’s and Chipotle, to raise their menu prices in an attempt to balance the wage hikes, as per Business Insider.
In 2022, Newsom signed another bill aimed at raising the minimum wage for fast food workers to $22 an hour, but it was met with strong opposition from fast food corporations. This led to a successful referendum that halted the law, resulting in the AB 1228 as a replacement, setting the minimum wage at $20 an hour. This law affects around 550,000 fast food workers and 30,000 restaurants in California.
Yum! Brands, the parent company of Pizza Hut, KFC, and Taco Bell, acknowledged the changes in delivery services at certain franchise locations in California. The company stated that its franchisees operate independently, adhering to local market dynamics and complying with all regulations, while continuing to provide quality service and food through carryout and delivery.
This situation underscores the negative impact of well-intentioned but poorly executed government policies, leading to job losses and increased financial strain on businesses and consumers alike.
