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LA FATBURGER RESTAURANTS RAISING PRICES AS CALIFORNIA INCREASES MINIMUM WAGE

By Alexa Mae Asperin
Published 18 hours ago
FOX 11
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CALIFORNIA PIZZA HUT LAYOFFS

Nearly a hundred Pizza Hut franchises in California are laying off delivery
drivers.

LOS ANGELES - You might have to pay more for your burger and fries at some fast
food restaurants across California (if you aren't already) as companies look for
ways to offset costs ahead of a California law mandating the increase of the
state's minimum wage for fast food workers come April. 



Marcus Walberg, who owns four Fatburger franchises in Los Angeles, told Business
Insider the menu prices at his restaurants have already gone up, and he's also
cut down employees' hours because of the new law. 

"I feel that there will be a lot of pain to workers as franchise owners are
forced to take drastic measures," he told Business Insider.

SUGGESTED:

 * New California laws 2024: Minimum wage up to $20 for fast-food workers
 * California raises minimum wage for fast food workers: Here's how much they'll
   get
 * California food prices could get even more expensive as fast food wages set
   to increase

The current minimum wage in California is $16 per hour and will increase to $20
in April. The move comes after the passing of AB 1228, which was proposed in the
wake of the rising cost of living and most fast-food workers living at or below
the federal poverty line. The bill stated the high cost of living prompted "the
urgent and immediate need to provide fast food workers a living wage."

Walberg told the outlet he'd hike up prices as much as 10% at his four
restaurants when the law goes into effect April 1. Last year, he had implemented
a 8% menu-price increase.

Loading Video…

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NEW CA LAWS: FROM MINIMUM WAGE TO SICK LEAVE

Hal Eisner breaks down some of the new laws that take effect in California in
2024, including minimum wage and paid sick leave.

"It’s a scary thing because customers are already complaining that prices are
too high," Walberg told the outlet. 

Walberg is also saving money by trimming employees’ hours, he told Insider, in
addition to eliminating the paid-time-off programs at his franchises "to prepare
for the increase in wages in 2024."

"We’re not hiring new people to fill jobs," he said. "We’re being very tight on
schedules."

Fatburger isn't the only fast food restaurant finding ways to implement
cost-saving measures ahead of the impending law.

Last year, McDonald's and Chipotle executives said they will raise menu prices
this year in California to offset the minimum wage increase.

Around the same time, Pizza Hut announced it would lay off all its delivery
drivers at all California franchises as the chain braces for the minimum wage
increase.

SUGGESTED: California Pizza Hut franchises laying off all delivery drivers

The decision affects Pizza Hut locations in Los Angeles, Orange, San Bernardino,
Riverside, and Ventura counties. 

File photo of a Fatburger neon sign at night in Los Angeles, 2015. / Getty
Images (Getty Images)

Moving forward, the California Pizza Hut franchises will rely on third-party
delivery apps like Uber Eats, GrubHub and DoorDash for deliveries.

As part of the law, a nine-person council was established that has the authority
to raise the hourly minimum wage annually for the fast-food industry, through
2029. The council will adjust wages by either 3.5% or the annual change in the
consumer price index.



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