McDonald’s is warning that California’s new minimum wage law will hurt franchisees in the state and could raise prices for consumers when it takes effect next year.
Last month, California Gov. Gavin Newsom signed into law a minimum wage hike for fast food workers at restaurants with at least 60 locations nationwide – although the law contains an exception for restaurants that sell their own bread. It increases the minimum wage for covered fast food workers to $20 per hour effective on April 1, 2024.
McDonald’s CEO Chris Kempczinski said on an earnings call Monday that the law is going to have “a wage impact for our California franchisees” and that “I don’t think at this point, we can’t say exactly how much of that is going to work its way through pricing.”