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Battle over whether franchisor is joint employer begins before NLRB judge
Arguing before a National Labor Relations Board (NLRB) administrative law judge, McDonald’s, the world’s largest franchisor, and the NLRB’s general counsel took opposite sides March 10 over whether the company should be considered a “joint employer.” If the general counsel prevails and McDonald’s is held liable for any violations of the National Labor Relations Act that a franchisee commits, workers could unionize and bargain with headquarters.(Washington Post)
How McDonald’s Labor Trial Could Affect the Entire Fast Food Industry
If McDonald’s loses, giant fast food companies nationwide could be responsible for working conditions at all of their locations, including franchisees. The lawsuit is an outgrowth of protests by McDonald’s workers at franchisees in New York City, who called for higher wages and then allegedly were retaliated against by management, who threatened to fire the workers if protests continued.(Eater)
NLRB Charges Against McDonald’s Put Focus on HR
The NLRB charged in 2014 that McDonald’s acted with franchisees to take the alleged retaliatory discipline against employees—including reduction in hours, discharges and other coercive conduct—in response to the employees trying to improve their wages and working conditions during Fight for $15 protests. If franchisors reduced their interaction with franchisees because of the charges, HR consultants may have an opportunity to help provide tips to franchisees about wage and hour laws and labor laws. Franchisees typically don’t have their own HR professionals on staff or in-house or external legal support.(SHRM Online)
Fast Food Strikes in More than 160 Cities
Supported by the Service Employees International Union, the Fight for $15 strikes have been periodically held in at least 160 cities, calling for fast-food wages to be at least $15 an hour. McDonald’s has responded to the protests by noting that 90 percent of its restaurants are independently operated by franchisees who set their own wages.(Ms. Magazine)
Why Should McDonald’s Be a Joint Employer? NLRB Starts to Provide Answers
But McDonald’s tells franchisees how to staff restaurants, when to clean bathrooms and where partially completed orders should be placed on counters, among other directives, an NLRB attorney testified Thursday. Business consultants, scheduling systems and hiring software provided to franchisees show the company calls the shots, the NLRB attorney said. However, the company disputes the joint-employer designation and says it could undermine its franchising tradition. Witness testimony is scheduled March 14 on the joint employer questions. The case then moves from New York to Chicago and Los Angeles, where unfair labor practice complaints have been filed, before returning to New York.(Chicago Tribune)
Allen Smith, J.D., is the manager of workplace law content for SHRM. Follow him @SHRMlegaleditor.
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