The debate to raise minimum wage in California is totally negated. The debate holds no weight because workmens compensation rates are completely out of control there. Arnold the Governator was able to get a little reform but with all the lawsuits flying it is no use, the system is broken. How can the employers pay the workers anymore, they are already paying more only the insurance companies are getting the money not the workers. This recent article is very telling indeed. "62 Pizza Hut Restaurants Close Over Workers' Comp" http://www.sandiego.com/sdbusiness.jsp 62 Restaurants? At an average of 20 employees each? Ouch, but as this makes the news how many small business people who employ similar numbers of people of between 5-15 people close each day due to issues which come from unnecessary lawsuits? Hmm? For instance in this case employment lawsuits drove up the costs of workmen's compensation insurance. Terry Greenberg of AIG, world's largest insurance company stated: "The Trial Lawyers are the Real Terrorists" which anyone who really studied the situation would have a hard time arguing that. If you raise minimum wage on top of the workmens compensation costs, well there just will not be any jobs anyway? And apparently no pizza either? Bummer I like the thick crust with the cheese inside. The problem in the story; Who Stole the Cheese from Pizza Hut is that the workmens compensation rates have been driven up by lawyers and lawsuits and the costs of health care. There are many business models, which will fail to be profitable at a certain point as costs go hyperbolic. QSRs Quick Service Restaurants in San Diego's high dollar and high cost of living area is simply one of them. Insurance costs for workmens compensation could be as high as 100% with only a few incidents and those incidents may be fictitious claims, conjured up by chiropractors, perpetrators in cahoots with lawyers out to make fast money on the back of businesses. Think on this will you? |
