The National Labor Relations Board (NLRB) ruled yesterday that McDonalds can be held jointly responsible for employees’ treatment by the brand’s franchise owners. Why is this important? Because 90% of the 14,000 McDonald’s restaurants are owned by franchisees, and McDonald’s has always claimed that they aren’t responsible for the way the employees were treated at the franchises. And, because responsibility rested with the individual owners and not McDonald’s itself, any worker lawsuits or organization attempts were limited in scope,
Labor organizers have long argued that McDonald’s should be held accountable as a joint employer because of the control it has over menus, uniforms, supplies and many other terms of operations.
While yesterday’s ruling stemmed from older claims dealing with workers being fired from franchises when they attempted to unionize, it would logically also apply to the current class-action suits dealing with wage theft by certain franchise owners.
Wilma Liebman, a former chairwoman of the National Labor Relations Board under President Obama and now an occasional consultant to unions, said the decision could give fast-food workers and labor unions leverage as far as getting the company to negotiate about steps that would make it easier to organize McDonald’s restaurants. She also said that the ruling could give the workers and unions more clout in pressing McDonald’s to have its franchisees raise wages.
Julius Getman, a labor law professor at the University of Texas, said: “Employers like McDonald’s seek to avoid recognizing the rights of their employees by claiming that they are not really their employer, despite exercising control over crucial aspects of the employment relationship. McDonald’s should no longer be able to hide behind its franchisees.” And Micah Wissinger, an attorney at Levy Ratner who brought the case on behalf of McDonald’s workers in New York City, said; “McDonald’s can try to hide behind its franchisees, but today’s determination by the NLRB shows there’s no two ways about it: The Golden Arches is an employer, plain and simple.” He went on to say; “McDonald’s has tried to avoid the obligations associated with employing the vast majority of the people who prepare and serve their food, but the reality is they require franchisees to adhere to strict rules.”
Of course, not everybody is happy with the ruling. Steve Caldera, the CEO of the International Franchise Association (IFA), wrote in The Hill prior to the ruling; “Years of federal and state legal precedent would be upended and thousands of small business owners would lose control of the operations they worked hard to build. The result would be a wave of ‘going out of business signs’ across the country and thousands of lost jobs. Signed contracts would be tossed away as if they had never been written.” And, after the decision was made public, he said in a statement; “If franchisors are joint employers with their franchisees, these thousands of small business owners would lose control of the operations and equity they worked so hard to build. The jobs of millions of workers would be placed in jeopardy and the value of the businesses that employ them would be deflated.”
Occupy World Writes applauds the NLRB’s decision. By ruling that companies are just as liable as the individual franchise owners themselves when it comes to workers’ rights, they’ve put the whole franchise industry on notice. And just like when we wrote about the fast food worker strikes back in May, we can’t help but think of the McDonald’s jingle…
I’m loving it!