Pizza Huts in California, including Sacramento, laying off drivers rather than pay $20 minimum wage

Andrew Sheeler
·2 min read
202
A customer enters the Pizza Hut at 1100 Fulton Ave. in Arden Arcade on Wednesday, Dec. 27, 2023. The owner of the Sacramento County franchise is laying off delivery drivers to avoid paying the $20 an hour rate required by a new state law for fast-food workers.

Rather than pay delivery drivers $20 an hour — under a new California law set to go into effect in April 1, 2024 — Pizza Hut franchisees in Sacramento and elsewhere in the state are laying them all off.

The franchisees, one of which operates restaurants in the Sacramento area, are letting go more than 1,200 delivery drivers across the state, according to Business Insider, which reviewed a federal Worker Adjustment and Retraining Notification Act document filed with the state Employment Development Department.

The WARN Act requires large employers to provide 60 days’ notice of a planned mass layoff.

According to Business Insider, Pizza Hut customers will have to either pick their pizzas up themselves, or else rely on third-party, app-based delivery drivers, such as GrubHub, Uber Eats or DoorDash.

The company behind the WARN notice is PacPizza, an LLC based in San Ramon. According to Business Insider, it operates Pizza Hut locations in Sacramento, Los Angeles and other cities.

According to Sacramento County food inspection reports, all six Pizza Huts in the county are owned by PacPizza or one of its subsidiaries, including CalPac Pizza.

The parent company of Pizza Hut told the Los Angeles Times on Wednesday it was “aware of the recent changes to delivery services at certain franchise restaurants in California.”

California Gov. Gavin Newsom signed the minimum wage increase into law in September. The new law also creates a Fast Food Council that will oversee wages and workplace conditions in California franchises.

The fast food industry initially opposed the legislation and had vowed to launch a referendum campaign against it if it became law. However, the two sides were able to come to an agreement that saw the referendum campaign dropped, in exchange for the implementation of a $20-an-hour minimum wage.