Photo of a Pizza Hut Restaurant by Saumya Rastogi on Unsplash
Starting a brand new year by eliminating jobs from your nation-wide franchise is a terrible thing to do to workers. That said, it appears that Pizza Hut franchises in California decided to do exactly that. More specifically, the franchises (which are owned by Yum! Brands) decided to dump all their delivery drivers without notice.
ABC News Los Angeles station KABC was the first to report (on December 28, 2023) that two major Pizza Hut franchisees with restaurants in Orange, Los Angeles, Riverside, San Bernardino and Ventura counties are planning on layoffs that would impact 1,200 workers.
Why did this happen? The minimum wage in California increased to $20 an hour for fast food workers in 2024. According to KABC, some Pizza Hut franchisees say they’re preparing to eliminate jobs as well as delivery options for customers.
The mass layoffs would also reportedly impact another 800 Pizza Hut workers in Sacramento, Central California, Southern Oregon, and the Reno-Tahoe area, according to KABC.
The cuts would eliminate the franchisees’ delivery services for customers in those locations. Customers will instead have to rely on services like Uber Eats or DoorDash.
Naturally, the quote that was given to ABC News – and some other outlets. The tone of the quote is definitely giving off the “poor me” vibes.
“Pizza Hut is aware of the recent changes to delivery services at certain franchise restaurants in California,” a company spokesperson said Thursday. “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. Where select California franchisees have elected to make changes to their staffing approach, access to delivery service will continue to be available via Pizza Hut’s mobile app, website, and phone ordering and the customer ordering experience will remain consistent.”
In my opinion, this statement appears to be presented as though Yum! Brands just cannot possibly do anything at all about the layoffs. Or, perhaps, it simply doesn’t care about the delivery drivers who were laid off. A cheesy, response, at best.
In September of 2023, California Gov. Gavin Newsom signed AB 1228 into law as a modified version of the FAST Act, which was originally passed a year ago, and then it was put on hold following a lawsuit initiated by the Save Local Restaurants Coalition. Nation’s Restaurant News reported.
The new version of the legislation was proposed by state assemblymember Chris R. Holden and supported by several industry lobbying groups, including the Service Employees International Union, the National Restaurant Association, and the International Franchise Association. It took out more of the extreme versions of the law including the original $22 an hour minimum wage starting Jan. 1, and the controversial joint liability rule between fast food franchisors and franchisees.
The thing I really want to point out is that this legislation was originally presented in September of 2023 – four whole months before the legislation was to take effect. One would think that this would encourage Pizza Hut franchisers to take a look that the final legislation and start planning how they would be able to keep their employees on the job.
Instead, they seem to have taken the greedy way out.