2023-12-29 16:51:24
The minimum wage for fast food workers in California will increase by 2024, benefiting most of the Golden State’s 500,000 fast food workers. However, this measure has already begun to cause massive layoffs.
An agreement was reached on September 11 that ended a standoff between the industry and unions over wages and working conditions. It is estimated that AB 1228 will benefit nearly half a million workers who work for fast food chains, with at least 60 restaurants spread across the country, with the exception of restaurants that make and sell their own bread, such as Panera Bread. . However, the more than 25% increase in salary is forcing companies to take severe measures.
SINCE WHEN IS THE WAGE INCREASE APPLIED FOR FAST FOOD WORKERS?
Currently, fast food workers in California earn US$15.50 an hour, but starting April 1, 2024, they will have a minimum wage of US$20. A Council may propose further increases until 2029, adjusted for annual inflation.
This new Council will only have the power to set wages, but not to define industry labor standards for fast food restaurant workers, as was intended with the Fast Food Council.
The agency can make recommendations on working condition standards to various state agencies.
Fast food workers in California will have a salary increase from 2024 (Photo: AFP)
MASS LAY OFF OF FAST FOOD WORKERS IN CALIFORNIA
The large operators of the Pizza Hut chain in California announced that they will lay off all their delivery drivers, due to the new law that raises the minimum wage for fast food workers to $20 per hour. In that sense, it is estimated that more than 1,200 delivery drivers would be affected, which impacts hundreds of the restaurant chain’s establishments throughout the state, including the counties of Los Angeles, Orange, Riverside, Ventura and San Bernardino. as reported by Business Insider. The layoffs will take place in February 2024, according to federal job notices obtained by Business Insider.
“PacPizza, LLC, doing business as Pizza Hut, has made a business decision to eliminate in-house delivery services and, as a result, the elimination of all delivery driver positions,” a federal WARN Act notice said. presented by the franchisee.
A second Pizza Hut franchise, Southern California Pizza Co., also plans to lay off 841 drivers. The layoffs will affect drivers at Pizza Hut locations in Sacramento, Palm Springs, Los Angeles, Central California, Southern Oregon and the Reno-Tahoe area, among others.
One of the options that the chains use is to use a company focused on delivery, instead of hiring their own delivery drivers (Photo: AFP)
How will the distributions be made?
Pizza Hut franchises will outsource shipping through apps like DoorDash, GrubHub and UberEats for pizza and food deliveries.
PRICES WILL RISE IN CALIFORNIA
The Chipotle and McDonald’s chains have announced that among their plans they consider increasing menu prices in the state to try to compensate for the higher cost that the increase in the minimum wage of their workers will represent.
WHY ARE COMPANIES OPPOSED TO THE NEW WAGE?
The main opponents of the new salary for delivery drivers in California are food delivery companies, such as Uber Eats, DoorDash and Lyft, as well as employer unions such as the California Chamber of Commerce. Among its arguments are:
- Rising costs for consumers and restaurants
- Loss of jobs
- Undermining the flexibility and autonomy of delivery drivers
MORE INFORMATION ABOUT SALARIES
HOW IS THE LOCAL MINIMUM WAGE APPLIED?
A total of 30 states and several cities set their own minimum wage rates, which are higher than the federal one. If federal, state, and local government minimum wages are different, the higher wage rate applies.
WHAT IS OVERHOUR PAY LIKE IN THE UNITED STATES?
The Fair Labor Standards Act (FLSA) grants the right to obtain overtime pay. Most employees are entitled to a special rate of overtime pay for any hours worked over a total of 40 in a single workweek.
The wage rate for overtime is at least one hundred fifty percent (150%) of the normal wage rate.
WHAT ARE THE SANCTIONS FOR NOT COMPLYING WITH THE PAYMENT OF THE MINIMUM WAGE?
If you have not received full payment of your minimum hourly wage, the Department of Labor can sanction employers in two ways.
- Payment Orders: The employer may be ordered to make payment of back wages, interest for late or non-payment, liquidated damages and may also be fined.
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