Wendy's response to minimum wage hike: Replace staff with machines
Just when you think the fight for a $15 minimum wage is making progress, an international corporation hawking "old-fashioned hamburgers" comes along and throws a wrench in the master plan with the aid of a robot army.
Wendy's, one of the world's largest fast food chains, says it will replace human employees with automated self-service kiosks in many of its approximately 6,500 restaurants. According to Wendy's CTO Todd Penegor, the sweeping move is an effort to counteract minimum wage hikes.The new technology will be made be available for all locations later this year, but kiosk installation will not be mandatory for franchise restaurants, according to Investor's Business Daily.
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Wendy's teased the move last August. "We continue to look at initiatives and how we work to offset any impacts of future wage inflation through technology initiatives, whether that's customer self-order kiosks, whether that's automating more in the back of the house in the restaurant," Penegor said during the company's second quarter conference call. "And you'll see a lot more coming on that front later this year from us."
Conservative groups that oppose minimum wage increases used Penegor's statement as evidence that such initiatives would only hurt the working class. Nine months later, Penegor is following through on the plan to introduce automated ordering kiosks to control costs. Some Wendy's franchises have raised food prices to combat wage increases, but, in theory, kiosk adoption could allow franchises to keep pricing consistent despite increases in minimum wage. Wendy's has 258 restaurants in California, which has raised the minimum wage to $10 an hour and will be increasing it to $15 by 2020.
Though Wendy's will be the first chain to install self-serving systems on a wide scale, McDonalds has also been testing digital kiosks at a few of its restaurants. The CEO of Carl's Jr. and Hardee's, Andy Puzder, has also expressed interest in replacing staff with machines since he says the government is making it harder for him to hire employees. McDonalds and all of Yum Brand's companies—KFC, Pizza Hut, and Taco Bell—currently have apps that allow ordering.
At this rate, soon you won't ever have to worry about a human talking you into ordering a hot, baked apple pie pocket.