Pizza Hut To Lay Off Over 1,200 Workers In California As State Raises Fast Food Minimum Wage To $20 An Hour

 More than 1,200 Pizza Hut delivery drivers throughout California will be out of a job in the coming months after California’s fast food minimum wage increase. 

Numerous Pizza Hut franchises in California announced they would eliminate delivery driver positions and rely on third-party delivery companies such as DoorDash, GrubHub, and Uber Eats as the state’s minimum wage for fast food workers will increase to $20 in April, CBS News reported. The layoffs, which will start in February, will mostly affect Pizza Hut delivery drivers in Los Angeles, Orange, and Riverside counties. 

One delivery driver told Business Insider last week that he was offered $400 severance pay if he worked until February 5 — the date Pizza Hut told him he would be laid off. 

“The money they are giving us as severance pay is a slap on the face,” the Pizza Hut employee said. “It comes to $3 a month for nine-plus years of service.”

California’s Assembly Bill 1228, which increased the fast food worker minimum wage by 30% to $20 an hour, was signed into law by Democratic Governor Gavin Newsom in September. After the bill was signed, other fast food chains, such as McDonald’s and Chipotle, said they would increase menu prices to offset wage raises, according to Business Insider. 

In 2022, Newsom signed the Fast Food Accountability and Standards Recovery Act, which called for fast food workers’ minimum wage to increase to $22 an hour, but fast food corporations opposed the bill and successfully got a referendum on the ballot. That minimum wage law was frozen by a California court last January, allowing groups who opposed the law to count signatures of those against the minimum wage increase. 

AB 1228 then replaced the Fast Food Accountability and Standards Recovery Act, which made the minimum wage for fast food workers $20 an hour. The minimum wage law affects approximately 550,000 fast food workers and 30,000 restaurants in California, according to CBS News.   

 

Yum! Brands, which owns Pizza Hut, KFC, and Taco Bell, said it was “aware of the recent changes to delivery services at certain franchise restaurants in California.”

“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.”