A major fast-food franchisee in California, Harsh Ghai, is rushing to install kiosks at his restaurants to save money as the $20 minimum wage affects businesses.
Ghai owns approximately 180 fast food locations in the state, which include Burger Kings, Taco Bells, and Popeyes, Business Insider reported Friday.
“We are installing kiosks in every single restaurant,” Ghai explained.
The Insider report noted, “Some fast-food franchisees say that the higher payrolls could make it challenging to remain profitable. Many are desperately looking for ways to bring in more revenues and cut costs.”
In March, a major McDonald’s franchisee in Los Angeles criticized Gov. Gavin Newsom’s (D) minimum wage law forcing fast food businesses to raise employees’ pay to at least $20 an hour, Breitbart News reported.
Governor of California Gavin Newsom speaks onstage during Vox Media’s 2022 Code Conference in Beverly Hills, California. (Jerod Harris/Getty for Vox Media)
Kerri Harper-Howie said she can save money in other ways but everything eventually comes down to “we will take less…[which] means less profitability for us, and we will absorb that.”
Meanwhile, Ghai said he is trying to offset the raised wage by cutting employee hours, doing away with overtime, holding back on opening additional locations, and installing kiosks.
“Fast-food chains are rapidly deploying more order kiosks in the U.S. to reduce their labor costs. The new $20 wage in California has added even more urgency,” the Insider article said.
California’s mandate that fast food workers be paid $20 an hour, at minimum, went into affect on April 1, Breitbart News reported on April 2.
“The new rules raise the minimum wage by 25 percent for workers at large chain restaurants and establish a Fast Food Council that will have the power to implement further hikes up to 3.5 percent each year over the next five years,” the article said.
“While some workers will receive raises, others are likely to lose their jobs to automation or cutbacks. Minimum wage hikes tend to eliminate jobs for the most vulnerable, least-skilled workers in jobs that do not produce enough revenue to support the high wage level,” it added.
Last week, employees at a Foster’s Freeze in California learned they were jobless when they realized the location had closed down due to the $20 minimum wage mandate, Breitbart News reported April 5.
