The following is from Working Washington:
(July 30, 2014) — The National Labor Relations Board on Tuesday found that McDonald’s Corporation maintains such extensive control over operations at its franchisees that it functions as a joint employer and shares legal responsibility for employment conditions at franchised McDonald’s outlets. This decision confirms what workers have long known: in the fast food industry, the power is concentrated at the headquarters of the global franchise corporations whose poverty-wage business models bring them billions in profits.
Corporate franchise systems and their lobby group, the International Franchise Association (IFA), have long tried to have it both ways. The chains bank huge profits while trying to hide behind their franchisees, claiming that as franchisors, they lack control over wages and working conditions. Meanwhile, franchisees point in the opposite direction, arguing they’re not big corporations and can’t afford to pay better wages. Today’s ruling by the NLRB cuts off the games and the excuses, finding that both franchisor and franchisee share responsibility for employment conditions.
This decision also shines new light on the absurd “discrimination” claims brought in the IFA’s lawsuit against the Seattle minimum wage law. As the NLRB found, franchise systems are not the same as smaller independent businesses, which is yet another reason why Seattle city government had every right to distinguish between franchise chains and truly independent local businesses with regard to the timing of our phased-in $15 minimum wage.
Now that McDonald’s has been found to share responsibility for working conditions — not just profits — it’s time for them to reckon with their responsibility, stop trying to undermine labor standards, and ensure everyone who works for these chains can support themselves, afford the basics, and contribute to the economy.
► ALSO in today’s NY Times — NLRB rules that McDonald’s, not just franchisees, responsible for workers’ treatment — The general counsel of the National Labor Relations Board ruled on Tuesday that McDonald’s is jointly responsible for workers at its franchisees’ restaurants, a decision that if upheld would disrupt longtime practices in the fast-food industry and ease the way for unionizing nationwide. The fast-food workers movement has argued that McDonald’s should be considered a joint employer because it owns many of the franchisees’ restaurant buildings and requires franchises to follow strict rules on food, cleanliness and hiring. McDonald’s has even warned some franchisees that they were paying their workers too much.
► ALSO in today’s NY Times — McDonald’s ruling could open door for unions — Business groups called the decision outrageous. Some legal experts described it as a far-reaching move that could signal the labor board’s willingness to hold many other companies to the same standard of “joint employer,” making businesses that use subcontractors or temp agencies at least partly liable in cases of overtime, wage or union-organizing violations.