Pizza Hut Cuts Delivery Drivers Due To Minimum Wage Increase

Multiple CA Pizza Hut franchises will lay off drivers as the restaurant braces for an increase in the minimum wage for fast food workers.

Multiple Pizza Hut franchises in California plan to lay off delivery drivers as the restaurant chain braces for an increase in the minimum wage for fast food workers next year. 

Delivery Drivers Eliminated Becuase of Rising Minimum Wage

Two Pizza Hut operators in California are eliminating their in-house delivery services at hundreds of stores, resulting in more than 1,200 driver layoffs, according to federal-employment notices reviewed by Business Insider.

The layoffs, which will take place through the end of February, come as California’s minimum wage is about to go up by $4. Fast-food workers in the state are set to get a pay bump of close to 30% in April as the minimum wages rises from $16 to $20 an hour.

The layoffs affect Pizza Hut delivery drivers across California, including at Sacramento, Palm Springs, and Los Angeles locations. The Pizza Hut franchisees are reducing staff as fast-food chains in the state brace for a new law that increases worker pay to $20 an hour in April.

Several Pizza Hut operators filed notices to comply with the Worker Adjustment and Retraining Notification Act, saying they were discontinuing their delivery services. 

“PacPizza, LLC, operating as Pizza Hut, has made a business decision to eliminate first-party delivery services and, as a result, the elimination of all delivery driver positions,” a federal WARN Act notice filed by the fast-food operator with the state’s Employment Development Department said, Business Insider reported. 

Another operator, Southern California Pizza Co. also announced layoffs of around 841 drivers across the state. The moves impact Pizza Hut locations in Los Angeles, Orange, San Bernardino, Riverside and Ventura counties. 

Many of the franchises will rely on third-party delivery apps like Uber Eats, GrubHub and DoorDash. 

Pizza Hut, owned by the Taco Bell parent company Yum! Brands, told Business Insider that its “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.”

In California, nearly one million fast food and healthcare workers are set to get a major raise after a deal was announced earlier this year between labor unions and industries. 

Under the bill, most of Governor Newsome’s California fast-food workers will be paid at least $20 per hour next year. And a separate bill will increase healthcare workers’ salaries to at least $25 per hour over the next 10 years. 

Chains such as Chipotle and McDonald’s said they planned to raise menu prices as a way to offset the costs of higher wages in California.

The law affects 557,000 fast-food workers at 30,000 restaurants in California.

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One thought on “Pizza Hut Cuts Delivery Drivers Due To Minimum Wage Increase”
  1. Democrats should be proud putting all these people out of work. Fast food can’t support $20 an hour, these are jobs for high school kids not meant to support a family. I think California deserves the mess they have though they keep voting for these losers, pathetic.

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