California’s Fast-Food Wage Hike Backfires: Layoffs, Closures, and Soaring Prices

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April Fool’s Day seems to be a good time to start the minimum wage of $20.00 for California fast-food employees. AB1228 (Fast Food Accountability and Standards Recovery Act), signed by Governor Gavin Newsom, was scheduled to go into effect in April 2024. Newsom and Service Employees International Union (SEIU), despite warnings from economists, franchisors, and anyone else with a brain – pushed ahead. They claimed this was a win for workers, who can now earn a ‘living wage.

The consumer certainly didn’t win. The first thing that happened was the price of fast food began to rise. Next, Pizza Hut employees were laid off. FAST Act has now been fully implemented, as have the unintended effects. Fast-food restaurants cut hours on Tuesday, April 2, and laid off employees. Some even closed their doors.

Welcome to California where you can get a Big Mac Combo for $25.00, and it will be served by a robot. Stevie Wonder should have known this was coming, but power to the people and all that.

This result should not surprise anyone. Inflation in the US has increased operational costs and reduced profit margins at major food chains over the last few years. Inflation has caused menu prices to rise (such as the “$18 Big Mac”), and sales have slowed for all major fast food companies. A COVID stimulus combined with rent moratoriums has also impacted the restaurant industry in many areas. This has led to a labor shortage and wages of up to $16 an hour for new, no-skilled employees.

Small chains and mom-and-pop businesses cannot compete. The larger chains have raised prices but also had to reduce employee and labor costs by automation. But the layoffs just started.

California’s FAST Recovery Act was passed in 2022 and went into effect this April. The law requires certain food chains that deal in specific products to increase their minimum wage (which is already $16 per hour on average) up to $20. The income increase only applies to chains with 60 or more locations within the state of California.

Many restaurants have already laid off thousands of employees and some chains are closing multiple stores because of the high cost of operations.

Employees at Foster’s Freeze, Lemoore in California, discovered on Monday that they had received their final paycheck instead of an increase.

Monica Navarro said her former manager called her Monday to tell her the locks would be changed. Navarro believed it was an April Fools’ joke. Unfortunately, she was the victim of a joke.

“I was caught off-guard, no warning, no notice.” “I mean, the owner told me Happy Easter,” said she.

She wasn’t alone.

Former employee Jason Boado said, “We received a message in our group chat that the company was closing down. I thought it was a joke.”

She drove to the restaurant at Hanford Armona Rd where the owner was giving out final paychecks.

WATCH:

This is a shining example of why “at-will” employment is utter garbage. The American Dream to own and build your own business has died again in the San Fernando Valley. The owners of the Shanghai Bistro, located in Woodland Hills, decided it was time to retire.

Hi everyone,

Bruce and Debbie decided to retire after more than 20 years of service and three different versions of their restaurant, which served the Valley and the surrounding communities.

The Shanghai Bistro was founded in the early 2000s, after the opening of the first Lotus Inn, in Agoura Hill. Later, the second Lotus Inn opened on Ventura Blvd., followed by the Shanghai Bistro. We have had the pleasure of serving you great Chinese cuisine. In exchange, we’ve been able to see our children grow up, attend college, and start their own families.

We also thank you for your support throughout and after the pandemic. It was a very difficult time for all of us. We were also honored to have been able to contribute to the local medical workers during this time.

The American Dream for us was to open this restaurant and be a part of this community. To see the smiles on your faces as you taste our orange chicken. We couldn’t have asked for better twenty-something years and look forward to our retirement.

Sincerely Yours,

Bruce and Debbie

This former restaurant is now another boarded-up business on Ventura Boulevard. These businesses have decided to close their doors due to California crime, regulations, and the new minimum wage. It is unlikely that they will return. California currently has the highest rate of unemployment in the country, at 5.3 percent. Expect that number to rise with the FAST Act’s layoffs and business closures.

California now has the highest unemployment rate in the United States, with a rate of 5.3%. This is after new data revealed that the job growth in America’s most populous State was lower than originally thought.

California has lost an astounding 2.7 million jobs since the outbreak of the Coronavirus. These losses were caused by Gov. Gavin Newsom’s stay-at-home order forced many businesses to shut down.

The legacy media ignores AB5, which is the anti-independent contractor’s law that went into effect in 2020 just before the pandemic. AB5 affected 600 different professions and impacted the lives of 4.5 million independent professionals in the state. A study by the Mercatus Center, conducted four years after AB5 was passed and despite many lawsuits, shows that AB5 has not only decreased the number of independent professionals but also overall employment.

Stupid leftists, like Lorena Gonzales (minus “Fletcher”), cheer this increase in the minimum wage as if they were celebrating a victory for those who do the work. The Frankenstein who created AB5 as the head of Cal Labor is still strong in unions but weak in economics. He’s causing havoc for Californians trying to pay rent and feed their family.

Lorena: No, you and those like you are responsible for the fact that average fast-food workers are on the unemployment list. Mary Kay Henry, international head of SEIU, who initiated this campaign with “Fight for 15” many years ago is basking in her success and patting herself back for everything she has done to help workers.

This shows that the supposed struggle for workers’ rights has little to no connection with those who work. Whether it’s AB5, the FAST Act, or any other policy or law advocated by Big Labor, and their willing enablers within the California legislature, the working people get the short stick.

Workers now know what they didn’t back then. The press has been asked to stay away from a rally celebrating the increase in minimum wage scheduled to take place at the California State Capitol on Wednesday.

It is not advised to request coverage for this event due to the low turnout of workers expected. Please disregard the previous advisory. Sorry for any inconvenience.

These workers may be trying to hang on to their few hours or looking for a new job.

Good job, California.

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