APDD president urges Pizza Hut franchisee, NPC, to rethink driver reimbursment cut

Oct. 16, 2003

J.W. Callahan is the president of the Association of Pizza Delivery Drivers.

APDD has received reports from drivers in the Birmingham, Ala., area that NPC International, the world's largest Pizza Hut franchise, has reduced delivery compensation for drivers from $1 to 50 cents per run, effective immediately.

Officials at NPC International did not respond to inquiries about the reduction from APDD.

This follows last year's rollback in the Kansas City region in Pizza Hut stores, which the company claimed was a move to standardize driver compensation rates (see related story Pizza Hut memo warns of cut in driver reimbursements, hints at sales declines).

The move to lower reimbursement rates for delivery drivers flies in the face of the NPC mission statement, found at the NPC Web site:

"EMPLOYEES: We believe our employees are our most valuable asset. We will recognize our people for what they do. We will help them share in the company's success, which they make possible. We will recognize individual achievements and will help employees gain a sense of satisfaction and accomplishment in their work. We believe our people are our strength, and that their involvement and teamwork are essential to our company."

The Kansas City Star reports in its Star 50 list that NPC CEO Gene Bicknell's earnings were 17th among area executives, and that he received some $679,804 in compensation in 2000, not including stock options.

Mr. Bicknell was also the recipient of an award in 1998 as the Outstanding Philanthropist of the Year.

Mr. Bicknell took the company private in 2001, and bought back some $90 million worth of publicly traded stock (see related story Private Lives).

NPC reported revenue of $425 million in 2002, employing 17,000 people in 804 Pizza Huts in 27 states.

The company's human resources site claims "tremendous growth" over their 40-year history.

With the rising cost of gasoline, we have to ask ourselves why it is that NPC is dipping into the driver's pockets to fund their growth and expansion during a time of financial turmoil for the rank and file in these troubled times?

The answer is obvious. Doing this will put millions of dollars into the company's coffers to fund future growth. Pizza Hut and its franchisees have found an untapped source of income. By raising fees and cutting expenses, they can burn the candle at both ends, and come out of hard times smelling like a rose.

Pizza Hut leads the way with tip-killing delivery charges sweeping the pizza industry. This double assault on the delivery drivers by companies such as NPC must not continue! How much should we take? Unless drivers come together and stand firm to protect their tip money and driver reimbursement rates, this trend will continue.

Fifty cents a delivery was the standard rate for Pizza Hut in 1989. There was no delivery charge back then, and now the delivery charge at Birmingham NPC stores is 75 cents.

How can companies such as NPC claim that they need the money due to rising costs, and at the same time deny that the costs to the delivery drivers have gone up as well?

Reconsider this move to roll driver compensation back to what it was in decades past Mr. Bicknell. You're a philanthropist and a humanitarian. Don't build your business on the backs of the people who are essential to your company.

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