Pizza Chain Closes California Locations Just Before New Laws Go Into Effect

Before California raised its minimum wage for fast food workers, a pizza chain closed some of its locations. Mod Pizza, with 500 stores nationwide, shut down five California branches in late March, as reported by KMPH. These closures were part of a larger nationwide cutback.

Employees from the Clovis store, which closed abruptly, believe these actions were in response to the new wage law effective in April. "It just kind of seemed like the right timing," one worker said, preferring anonymity.

California's new law, effective April 1, boosts the minimum wage to $20 for certain fast food chains. This applies to chains with at least 60 locations, excluding bakeries. It means an annual income of $41,600 for affected workers.

In 2022, the average fast-food worker in the U.S. earned $13.43 per hour, with California's workers making $16.60 on average. Governor Gavin Newsom's legislation, AB 1228, not only increases wages but also creates a "Fast Food Council" for setting work standards.

Newsom emphasized the law's role in improving wages and conditions for over 500,000 fast-food workers in California. "California is taking one step closer to fairer wages and safer, healthier working conditions," he said.

However, the wage hike has led to job cuts as businesses anticipate financial strain. For example, Fosters Freeze in Lemoore closed down due to the wage increase.

Monica Navarro, a former assistant general manager at Fosters Freeze, discovered the closure when she arrived at work. The owner, Loren Wright, stated closing was a difficult but necessary decision given the expected inability to manage the wage rise.

Michael Ojeda, a Pizza Hut driver, was informed by his employer that he would lose his job due to these changes. "Pizza Hut was my career for nearly a decade and with little to no notice it was taken away," Ojeda shared, reflecting the personal impact of these business decisions.