Hundreds of Pizza Hut franchise operators with hundreds of stores across California will lay off all delivery drivers in February, according to a report by Business Insider. That’s more than 1,200 jobs.
The publication says it obtained financial filings through federal Worker Adjustment and Retraining Notification (WARN) Act notices that have not yet been made widely available to the public.
In the documents, Business Insider says the Pizza Hut franchisees explain they are cutting all delivery driver positions as the company braces for California’s minimum wage increase for fast food workers coming in 2024.
California-based fast food chains with 60 or more locations nationwide will have to begin paying employees $20 an hour in April, higher than the state minimum wage of $16 that becomes law on Jan. 1.
A number of franchise operators were upside as they still need to keep delivering to customers daily.
However, according to some of the operators that the new minimum wage law won’t impact their store, since some of them only have one location.
There were also concerns that the salary increases are ultimately passed off to both the customers and the store’s hard-working staff.
The Pizza Hut franchisees also mentioned that the main businesses are going to cut out employees to make up for the money they are losing.
Fast food workers who advocated for the minimum raise increase say it was desperately needed, saying they were not making a liveable wage.
Both the operators and other customers worry that costs will only continue to rise.
Pizza Hut customers across California will now have to rely on app-based delivery services, like Doordash and Uber Eats.
Business Insider reports a second Pizza Hut franchisee, Southern California Pizza Co., and its affiliates will also cut all in-house delivery services and lay off more than 840 drivers, according to a December WARN Act notice. – CBS News
