Here's McDonald's Latest Plot to Avoid Paying Their Workers More

October 29th 2015

Alex Mierjeski

McDonald's and the government are battling over how much control the corporation exerts on its franchises. The government says McDonald's controls the working conditions and payment of employees at stores operated by franchisees, which make up about 90 percent of McDonald's stores. But McDonald's disputes the claim, arguing its franchisees are independent operators. 

If McDonald's is determined to be a "joint employer" with its franchises, they will be subject to labor-related complaints at non-company-operated stores. Currently, McDonald's dictates many aspects of how franchise stores operate, including menu items, store layout, and equipment. Wage and labor conditions, the company claims, are not its responsibility.   

The company has faced pressure over persistent labor complaints and the need to address low wages recently. This week, it asked a federal judge to reject an order from the National Labor Relations Board (NLRB) demanding McDonald's turn over thousands of documents that would show communications between its national headquarters and franchise stores—in other words, communications that might reveal the extent of the company's influence, Reuters reported.

The case and a larger related one could fundamentally change the relationship between companies, franchise stores, employees, and unions. 

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The fast food giant complained that the subpoena order this week was both expensive and burdensome, claiming that it spent more than $1 million producing the requested emails and other documents from McDonald's executives and employees that work with franchise owners. The subpoenas were some of the latest moves in the NLRB's investigation into alleged labor violations at McDonald's brought by labor unions and workers recently, the Cook County Record reports.


The subpoenas are just one piece of a larger case involving other franchise operators and their parent companies

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Some experts say that such a ruling is in fact overdue, and that the decision to consider the "joint employer" issue reflects "the reality of how work is organized and controlled today through a network of organization," Thomas Kochan, a professor of work and employment research and engineering systems at MIT told ATTN: in August. It demonstrates, Kochan said, "a return to enforcing the original intent of the NLRB to provide employees with an ability to negotiate with the employer[s] that determines key aspects of their wages, hours, and working conditions."

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McDonald's and other low-wage, fast food employers have faced pointed criticism from workers and labor unions in recent years for providing consistently low pay, few benefits, and for creating a substantial population of workers that rely on public assistance programs to survive. Earlier this year, McDonald's announced that it would raise wages at company stores to an average of at least $10 per hour, and implement paid leave and financial assistance for education. While that raise could be significant for many workers, the change affected just 10 percent of McDonald's stores—the other 90 percent are franchised locations.

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According to Reuters, McDonald's request comes days before a scheduled court hearing. The broader case, which could go on for years, is expected to begin in January.