Another California small business and its workers have seemingly suffered at the hands of the state’s newly enacted $20 minimum wage.
“It’s a shock,” Monica Navarro, former assistant general manager at Fosters Freeze in Lemoore, said Wednesday on “The Bottom Line.”
“It would have been nice to have a notice, so we could go get some applications [out], I could prepare them,” she continued. “The best I can do is honestly give them some references.”
When making their way to work Monday morning, Navarro and her team learned upon arrival that the restaurant owner had made the decision to close its doors for good. The owner, Loren Wright, told local Fox affiliate KMPH that this was the “last thing” they wanted to do, but knew by Friday night the business likely wouldn’t be able to absorb the wage hike and didn’t “want to ruin their Easter Sunday.”
CALIFORNIA FAST FOOD FRANCHISEE SLAMS NEWS MINIMUM WAGE, INVESTS IN NEVADA OVER SIX-FIGURE LOSS
The new California statewide legislation went into effect Monday and enforces a $20 minimum wage for restaurants that have at least 60 locations nationwide, except those that make and sell their own bread.
“Two of my coworkers were actually going in to clock-in for the morning. And right after that, that’s when I got a phone call that we were closing. So they found out right as they were about to clock-in for the day,” Navarro recalled.
“We had gotten a text in the group chat that we were shutting down, and I completely thought it was an April Fool’s joke,” one of Navarro’s colleagues also told KMPH.
After speaking further with management and Fosters Freeze’s owner, Navarro learned that the minimum wage law was the primary factor in the restaurant’s demise.
“He did blame it on the minimum wage increase. Although, from my understanding, I think we were exempt from it because of the amount of locations that he personally owns. But, he did ultimately blame it on that increase,” she said.
“I can see their intentions with increasing the minimum wage, thinking that it will attract more people,” the ex-manager added, “but I honestly don’t think it will work. This is not the first business that’s closing. There’s already a few local businesses for me that are closing, so I feel like this is just only the beginning.”
Speaking on behalf of the now unemployed Fosters Freeze team, Navarro claimed they would have preferred working at a lower hourly rate than being laid off.
“From the people that I spoke to, my employees, we would have rather stayed at the wage that we did have before, just because now we don’t have a job,” Navarro said. “And those who are still working in the areas around us that went up to $20 an hour, they got their hours severely cut. And it’s a lot less people working on shifts. So their jobs got a lot more difficult.”
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FOX Business’ Breck Dumas contributed to this report.
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