What the NLRB Announcement on McDonald’s Means

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In case you missed it, National Labor Relations Board (NLRB) General Counsel Richard F. Griffin made a pretty significant announcement about McDonald’s and its role as an employer to workers in franchise locations all over the country.

Historically McDonald’s has claimed it has no authority over wages or complaints of workers’ rights violations at its franchise locations because that is up to the individual owners, but the NLRB general counsel determined McDonald’s could be liable as a joint employer in these kinds of situations.

There’s been a lot of head scratching over what this announcement means and its implications for other large companies and workers at these kind of fast food franchises, so here is some basic information to break it all down for you.

How Did This All Come About?

You’ve probably noticed that fast food workers all over the country are fed up. In recent years these workers have been speaking out against low pay and working conditions in the fast food industry, culminating in several strikes and days of action that have captured the hearts and minds of people who care about workers’ rights. Some workers who spoke out said that their employers retaliated against them, even though such concerted activity is protected by federal labor law. Those workers filed charges of unfair labor practices with the NLRB and presented evidence that McDonald’s does indeed have significant control over wages and labor relations at its franchisees. Which brings us to the NLRB McDonald’s news.

What Did the NLRB Say?

General Counsel Griffin investigated charges alleging McDonald’s franchisees and their franchisor, McDonald’s, violated the rights of workers as a result of activities surrounding the fast food strikes and protests. He found some of these charges to have merit and, significantly, determined that McDonald’s should be considered a joint employer with its franchisees. Basically, McDonald’s wouldn’t be able to hide behind the franchisee, but also may be held responsible for the policies in place that deal with terms and conditions of employment, and labor practices.

What Happens Next?

If the workers and the employers cannot come to a settlement, the NLRB general counsel will issue complaints and try the cases before administrative law judges. Those judges then make rulings and the losing parties can appeal to the full NLRB board in Washington, D.C. NLRB decisions could be appealed to a federal appeals court, and then possibly to the Supreme Court.

Will All Franchisors Be Considered Joint Employers Now?

Not necessarily. This case is specific to McDonald’s. That being said, this could have implications for other employers on a case-by-case basis if more unfair labor practice charges come up.

What’s the Big Picture?

Even though this story has a long way to go, this is “pretty significant,” says AFL-CIO Legal Counsel Sarah Fox. What makes this case so interesting is that the joint employer doctrine can be applied not only to fast food franchises and franchise arrangements in other industries, but also to other practices companies use to avoid directly employing their workers, such as subcontracting, outsourcing and using temporary employment agencies. “Companies are increasingly using these kinds of arrangement to distance themselves from their workers and shield themselves from liability as employers,” says Fox. “These are the devices they use so that they can get the benefit of the work the employees do, but say ‘I’m not responsible’ for unfair labor practices, health and safety violations, paying proper employment taxes or complying with other legal responsibilities of an employer.”

The notion of the joint employer doctrine is an important concept for holding employers responsible, even if there’s a third party involved, when they are effectively exerting control over wages and working conditions.

Reposted from AFL-CIO NOW.

Photo courtesy of Mike Mozart via Flickr.

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These 3 Companies Should Start Paying a Bad Boss Tax Now

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Early last week the Internet was abuzz with a new, but clever concept called the “bad boss tax.”

Conceptualized by TakeAction Minnesota, the bad boss tax would impose a fine on billion-dollar corporations with employees that rely on government assistance.

While the future of the bad boss tax is uncertain, the number of employers paying wages so low that they inadvertently shift the financial burden to taxpayers is extensive.

Below, we’ve compiled the top three “Bad Bosses” below.

McDonald’s

According to the Bureau of Labor Statistics, fast food workers, on  average, make about $18,880 a year. According to the living wage calculator, that’s barely enough to keep one person from poverty, let alone a family.

What’s more, many McDonald’s workers report to only making the minimum wage, as low as $7.25. That number, compared to the CEO’s $13.8 million compensation is one of the many reasons why McDonald’s landed on the list.

Worker pay at the Golden Arches, due in part to franchising, is varied. But one thing is for sure, across the board employees are fed up. Yesterday the National Labor Relations Board (NLRB) ruled that McDonald’s could be accountable for the string of low wage lawsuits that it’s been slammed with in the past year.

The past year has been rocky for the billion-dollar corporation. Protests over low pay, the right to unionize and unfair treatment have been brewing for months and in May workers across the world banded together for a global protest. Additionally, workers protested in front of the fast food giant’s corporate headquarters during the annual shareholders meeting.

Walmart

On average, workers at Walmart are paid $8.81 an hour. An employee working 34 hours a week only makes $15,576 annually, far below the federal poverty line for a family of two or more. Keep in mind that Walmart CEO compensation was estimated to be around $20.7 million while revenue is nearly $500 billion.

Perhaps as a direct result, it was recently reported that Walmart’s low wages are costing taxpayers nearly $6.2 billion for public assistance services such as Medicaid, food stamps and housing. That means that one of America’s most profitable businesses relies on taxpayers to support their employees.

YUM! Brands

Low wages run rampant at YUM!, the owner of KFC, Taco Bell and Pizza Hut, with many workers making less than $8 an hour. Aside from it being an unlivable wage no matter where you’re from, YUM! has about 900,000 employees, many of whom need to have their wages subsidized by hard working, middle-class taxpayers.

Despite its CEO (name?) making $14.2 million (over what year) and its employees making poverty level wages, YUM! isn’t shy about its opposition to raising the minimum wage. On several occasions the fast food giant has lobbied to keep the minimum wage where it is, despite its CEO making 1,000 more than many of his employees.

Photo courtesy of Mike Mozart via Flickr.

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Class-Action Suit: McDonald’s and Franchisees Accused of Wage Theft

Photo courtesy Ben Gilman on Flickr

class-action lawsuit has been filed against McDonald’s and the company’s franchisees in three states, alleging various forms of wage theft at restaurants in California, Michigan and New York, Salon’s Josh Eidelson reports. Among the accusations are stores not paying properly for overtime hours, workers being required to clean uniforms off the clock and employees being required to show up for work, but not allowed to clock in when business is slow.

Eidelson argues that one of the key aspects of the lawsuit is that it will shine a light on how heavy a role the corporation plays in the running of franchise restaurants it doesn’t own:

The most significant threat posed by the potential class actions—one apparent arm in a campaign of media, consumer, political, economic and workplace pressure on fast food giants—may be its potential to draw scrutiny and force disclosures about the relationship between the giant McDonald’s corporation, which netted over $5 billion in profit last year, and its smaller individual franchisees, which are the legal employers of most McDonald’s workers.

Reposted from AFL-CIO NOW

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McHelp Me! McDonald’s Pushes Welfare, Not Wages

McDonald’s can’t say it doesn’t know it pays its workers so little that many of them qualify for public assistance (52% of fast-food workers do) to eat, go to the doctor or heat their homes. In fact, the burger giant appears to encourage its employees to seek out government help to meet the ends that their paychecks won’t.

The people who staff the company’s “McResource” help hotline for employees are so well-versed in the needs of workers who make poverty-level wages, they seem to have information on how and where to apply for food stamps, Medicaid and other programs for the poor right at their fingertips.

Read more from Salon’s Josh Eidelson who writes about the phone call Nancy Salgado, a 10-year employee in Illinois making the state’s minimum wage of $8.25 an hour, made to the McResources line, and then take a look at this video with excerpts from that call for help.

BTW, according to National Employment Law Project, the government spends about $7 billion a year on public assistance for fast-food workers like Salgado. Those are our tax dollars at work, not fast food’s, which makes $7.4 billion in profits. As the video points out:

McDonalds doesn’t want to pay its workers more. It wants you to pay its workers more.

Find out more at Low Pay Is Not OK.

Reposted from AFL-CIO NOW

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Look Down Under for Fast-Food Justice at McDonald’s

Most fast-food and other low-wage workers are back on the job after a series of rolling strikes earlier this month demanding a living wage and the right to join a union without employer retaliation. More strikes are planned around Labor Day. But the struggle continues for economic justice for the workers who earn the minimum wage ($7.25) or just above.

Two articles you may have missed show that boosting the workers’ pay to $15 an hour just might not cut into the profits of companies like McDonald’s or cost consumers much more for their favorite burger.

Jordan Weissmann, writing for The Atlantic, takes a look at Australia, where the minimum wage for adults is $14.50 an hour and a new agreement exists between McDonald’s and the workers’ union—the Shop, Distributive and Allied Employees Association. Not only does the new deal include a 15% wage increase, but many McDonald’s workers Down Under already were earning more than the minimum wage.

In a country where the two key elements of the U.S. workers’ demands are met—a living wage and a union—McDonald’s 900 or so restaurants are turning a tidy profit. By the way, McDonald’s earns more revenue from its European operations, where minimum wages are significantly higher, than the burger giant does in the United States.

What would it cost you if U.S. fast-food chains woke up one day and decided that paying workers a living wage was the right thing to do? Not a whole lot, according to economists Jeannette Wicks-Lim and Robert Pollin who have studied the relationship between wage increases in the fast-food industry and the cost of doing business.

Using their research, the good folks at The Daily Beast developed a “McPoverty” calculator that shows you what just a few cents more out of your pocket for a burger would mean for the paychecks of fast-food workers. Click here to take a look.

Reposted from AFL-CIO NOW

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McDonald’s Budget Tool Advocates for $15 an Hour and We’re Lovin’ It

Want some truth with those fries? Want to super size it? McDonald’s this week is being mocked (rightfully so) for its nonsensical budget tool that assumes a person has two jobs (sure, who doesn’t these days?), pays $20 a month for health care and $0 for heating. Don’t rub your eyes, that’s a big fat zero. Oh, and the budget also ignores food, child care, gas and other obvious necessities.

Oddly enough, the budget does come to one conclusion we can all agree with: It takes at least $15 an hour to make ends meet. Note: Most fast-food joints pay minimum wage ($7.25 an hour) or slightly above.

H/t to the Workonomics Upworthy channel for bringing this to our attention. Check out the video in the post by LowPayIsNotOK.org.

Reposted from AFL-CIO NOW

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