California’s fast-food industry is once again at a crossroads. Following the April 1, 2024, minimum wage increase to $20 per hour (as previously covered here), fast-food operators have struggled with higher labor costs, price increases, job losses, and store closures. Now, the Fast Food Council is considering another increase to $20.70 per hour, with a final vote expected in April or May 2025.

If the proposed wage hike is approved, fast-food employers will need to act quickly to adjust labor budgets, pricing strategies, and compliance measures. Here are five key steps operators should start considering now to prepare for another wage increase.

Five Steps Fast-Food Employers Should Start Considering Now

1. Review Payroll and Budget for the Potential Wage Increase

If the new $20.70 per hour wage is approved, employers must:

• Ensure payroll systems are updated to reflect the new rate as soon as it takes effect.
• Adjust labor budgets to account for increased wage costs.
• Project financial impacts on operations, including potential reductions in hours, staffing, or menu price adjustments.

2. Plan for Higher Overtime Costs

With a higher minimum wage, overtime rates will also increase:

• 1.5x Overtime Pay: $31.05 per hour
• 2x Double-Time Pay: $41.40 per hour

Employers should evaluate scheduling practices, limit unnecessary overtime, and consider staffing adjustments to manage costs.

3. Update Employee Notices and Pay Stubs

If the increase is approved, fast-food operators...

Read Full Story: https://news.google.com/rss/articles/CBMi6gFBVV95cUxQUnZZTUowcUhoNnpYaW1hQ0VR...