According to job listings, the PlumpJack Café in Olympic Valley, California, which is partially owned by Democratic Gov. Gavin Newsom, is still offering some employees $16 an hour despite the recent increase in the state’s minimum wage to $20. The PlumpJack Group, a company founded by Newsom, owns the restaurant. In 2018, the governor placed his business holdings into a blind trust, which means he has no control over the wages offered by the restaurant.
Job listings for various positions at the restaurant, such as host and line cook, were posted on platforms like ZipRecruiter and Indeed. While positions like line cook and pastry cook listed their wages starting at $22 and $25 an hour, the host and busser openings, which were posted 27 days ago, listed their pay at only $16 an hour. The new minimum wage increase for fast-food restaurants in California took effect on April 1, requiring workers to be paid at least $20 an hour.
Newsom signed the legislation late last year, impacting 500,000 workers in the state, to which Newsom praised that the new law would be “fairer wages, safer and healthier working conditions, and better training by giving hardworking fast-food workers a stronger voice and seat at the table.”
I wonder why @CAgovernor @GavinNewsom’s food businesses don’t pay $20/hour? Live job posting at $16/hr in Olympic Valley. It’s very, very expensive to live there… but he doesn’t do as he tells others and doesn’t pay a living wage. https://t.co/hwppKvQgSY pic.twitter.com/JcVDF5PrsD
— Joe Patterson (@Patterdude) April 2, 2024
While Governor Newsom supported the increase, restaurant owners have expressed concerns about the impact of the new law on businesses in the Democratic-leaning state. Monica Navarro, a former assistant general manager at Foster Freeze, stated in an interview with Fox Business on Wednesday that her store in Lemoore, California had to close down due to the higher wages, resulting in the layoff of all employees. Navarro also observed that other local businesses were already shutting down and many employees she spoke to had their working hours significantly reduced.
According to the Wall Street Journal, major chains like Pizza Hut and Round Table Pizza had previously informed the state that they would be cutting 1,280 delivery drivers this year in anticipation of the wage increase. Since September of last year, the fast food industry in the state has seen a decline of 1.3% in employment, while overall private employment has fallen by 0.2% during the same period.
“This is the reality of today’s restaurants,” a spokeswoman for Fat Brands, owner of Round Table Pizza locations said. “Operators are doing their best to retain staff and keep doors open.”
Other dining establishments, like El Pollo Loco, are now looking into implementing automation to offset labor expenses by automating certain food preparation processes, as per the WSJ.
Newsom faced severe criticism following reports that he may have lobbied for an exception that allowed Panera Bread franchisee Greg Flynn, who contributed over $100,000 to Newsom’s 2022 campaign, to circumvent the wage hike. Flynn’s chain was reportedly granted an exemption from the wage increase, which applies to bakeries and restaurants in specific locations such as airports, hotels, and theme parks.
In an effort to secure Newsom’s approval of the bill, the Service Employees Union, a proponent of the legislation, allegedly introduced the bakery exemption after Flynn sought to have his chain excluded from the fast-food category, as reported by Bloomberg. Despite the controversy surrounding the governor, both Newsom’s office and Flynn have indicated that the chain restaurant will likely not be excluded from the wage increase, according to the Associated Press.
“Such a narrow exemption has very little practical value. As it applies to all of our peer restaurants in the fast casual segment, we will almost certainly have to offer market value wages in order to attract and retain employees,” Flynn told the outlet.
