California's largest Carl's Jr. franchisee collapses under $20 minimum wage pressure
A major Carl’s Jr. franchisee in California has filed for bankruptcy after months of heavy losses. Harshad Dharod, who owns 59 locations across the state, now plans to close or sell them all. The move comes as the fast-food chain faces broader struggles with competition and shifting customer tastes. Carl’s Jr. started in 1941 as a simple hot dog cart in Los Angeles. Over the decades, it grew into one of California’s most recognisable burger chains, known for its charbroiled burgers and bold flavours. In recent years, the company has tried to adapt by adding plant-based options and turkey burgers to its menu.
Dharod’s outlets have brought in over $6 million in monthly sales. Yet, this year alone, they have been losing more than $600,000 each month. He points to California’s new $20 minimum wage and a lack of support from Carl’s Jr. as key reasons for the financial strain.
Employees at these locations have reported harsh working conditions. Many claim they are overworked, understaffed, and even exposed to violence due to cost-cutting measures. Some staff have staged walkouts to highlight their concerns over safety and pay.
Now, Dharod is taking action. He plans to shut down 10 branches immediately and find a buyer for the remaining 49. National Franchise Sales has been brought in to handle the sale of these locations, which stretch from Southern to Northern California. The closure and sale of these 59 Carl’s Jr. restaurants will mark a significant change for the chain in California. Workers will face uncertainty as ownership shifts, while the brand continues to navigate financial and operational challenges. The outcome will also test how the company adapts to rising costs and evolving consumer demands.
