California Pizza Hut operators cutting all delivery driver jobs in 2024 due to minimum wage increase
SACRAMENTO -- Two 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.
"Well, I knew that was coming. All these big corporations they have to make money," said Scot Ward, owner of Stone Pizza in Roseville.
Ward says that unlike his big-box competitor Pizza Hut, his store will keep delivering to customers daily.
"Because I'm a mom-and-pop pizza place, that's what you do!" Ward said.
The new minimum wage law won't impact his store, since they only have one location, but Ward says the salary increases are ultimately passed off to both the customers and the store's hard-working staff.
"What these businesses are going to do is cut out employees to make up for the money they are losing," said Ward.
Fast food workers who advocated for the minimum raise increase say it was desperately needed, saying they were not making a livable wage.
"This new law that's coming in, I feel like it will have everybody equal, you know?" said Maria Hernandez, a manager for another local fast food chain in Folsom, and a fast food union member.
"I was working long hours and making basically no money. With these extra five dollars, it's a great deal," said Hernandez.
Pizza Hut customers across California will now have to rely on app-based delivery services, like Doordash and Uber Eats.
"I think that's not right," said Jeremiah Basarab, a Pizza Hut customer. "That's crazy to do to their own people."
He and other customers worry that costs will only continue to rise.
"Prices might have to go up. If they have to pay them more, everything is going to be so expensive," said Basarab.
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.
CBS13 reached out to Pizza Hut's parent company Yum! and also PacPizza, the franchise operator for the impacted California stores. We have not yet gotten a response to our request for comment.
