Chipotle CEO Brian Niccol says California governor Gavin Newsom's proposed changes to the minimum wage could cause the restaurant chain to rethink its presence in the state.
"We pay well beyond $15 an hour in California. So there there is legislation that has the potential to take the hourly wage up to $21, $22 an hour that will put organizations in a place where prices probably have to rise. It's unfortunate because it also impacts the economic model, and that could impact how many restaurants we open in the future in a state like California which is a shame," Niccol said at the Yahoo Finance All Markets Summit on Monday.
About 15% of Chipotle's 3,000 plus locations in the U.S. are located in California.
In early September, Newsom signed into law a bill establishing a "Fast Food Council." The 10-member council will set standards for pay, hours and working conditions for fast-food workers in the Golden State. If the referendum receives roughly 623,000 signatures by the first week of December, the measure will appear on the November 2024 California ballot.
The legislation could pave the way for raising the minimum wage for fast food workers to $22 an hour for employers with more than 26 workers. Currently, the minimum wage stands at $15 in the state.
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