Chipotle and McDonald's have also dealt with changes in operating costs.
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December 28, 2023, 2:36 PM ET
• 4 min reading
As California's minimum wage for fast food workers rises to $20 an hour in 2024, some Pizza Hut franchisees say they are preparing to cut jobs and delivery options for customers.
As ABC News' KABC first reported in Los Angeles, two major Pizza Hut franchisees with restaurants in Orange, Los Angeles, Riverside, San Bernardino and Ventura counties are planning layoffs that would affect 1,200 workers.
A Pizza Hut store is seen in Austin, Texas on November 1, 2023. Brandon Bell/Getty Images, FILE
The mass layoffs would also reportedly affect an additional 800 workers at Pizza Hut locations in Sacramento, Central California, Southern Oregon and the Reno-Tahoe region, according to KABC.
Yummy! Brands, the parent company of Pizza Hut, as well as other fast food companies such as KFC and Taco Bell did not immediately respond to ABC News' request for comment.
Customers at Pizza Hut locations that opt out of in-house delivery will instead have to turn to third-party apps like DoorDash or UberEats for food delivery.
In this June 29, 2018, file photo, a Pizza Hut delivery driver is seen in Shreveport, Louisiana. Shannon O'hara/Getty Images for Pizza Hut, FILE
The wage law AB 1228, which was signed into law by California Governor Gavin Newsom at the end of September, is the trigger for this decision by the operators, the franchisees say.
The new law takes effect in April and increases the minimum wage by $4 to $20 an hour.
Other fast food companies, including McDonald's and Chipotle, previously said the new law would affect the respective chains' operating costs and potentially change menu prices for customers.
Although a decision has not yet been officially made, Chipotle CEO Jack Hartung said on a conference call in November that prices at the popular fast-casual Mexican restaurant would need to change “to reflect dollar costs” and cover the new margins .
“We will definitely pass this on. We just haven’t made a final decision yet on what level,” he said.