California Regs Have Chain Steamed

Complying with regulatory issues in California has become so onerous and expensive that at least one chain says it’s fed up and might leave the state.

Andrew Puzder, CEO of CKE Restaurants, which counts Carl’s Jr. and Hardee’s among its brands, says his company is considering moving its headquarters to Texas, where 300 new Carl’s Jr. restaurants are scheduled to be built. Expansion has been halted in California, because according to Puzder, it costs about $250,000 more to open a restaurant in California than in Texas.

Puzder’s statements were recounted in an opinion piece for the San Jose Mercury News penned by Jot Condie, president and CEO of the California Restaurant Association, and David Houston, a restaurant owner and chair of California Citizens Against Lawsuit Abuse.

Restaurant jobs represent 10% the jobs in California. The authors say state regulations are hampering the ability of restaurant companies to effectively manage their businesses. Condie and Houston say they wrote the article to capture the attention of state lawmakers. They cite California’s work rules classifying general managers as employees and thus requiring specified break times. Puzder says he has had to fire managers who insisted on working more hours than the state allows.

Read the full article here.