Fast Food News – NLRB Names McDonald's as a 'Joint Employer'
This afternoon, the NLRB announced that it has issued complaints against McDonald’s franchisees and their franchisor, McDonald’s USA, LLC, as joint employers. In total, the NLRB issued 13 complaints involving 78 charges against franchises and McDonald’s USA, LLC where McDonald’s will be identified as a joint employer. Those cases include various allegations of discriminatory discipline, reductions in hours, discharges, and coercive conduct directed at employees including threats, surveillance, interrogations, and restrictions on communicating with union representatives or with other employees about unions and the employees’ terms and conditions of employment.
The complaints stem from the nearly 300 charges the agency has received since September 2012 alleging McDonald’s and certain of its independently owned franchisees violated the rights of employees involved in protests against the company. Since 2012, the NLRB has conducted an investigation into these claims and determined that, “McDonald’s, USA, LLC, through its franchise relationship and its use of tools, resources and technology, engages in sufficient control over its franchisees’ operations, beyond protection of the brand, to make it a putative joint employer with its franchisees.” Notably, the NLRB points to McDonald’s “nationwide response” to franchisee employee activity in the ongoing fast food worker protests, which OnLabor recently determined to be one the top labor stories of this past year.
McDonald’s has issued a statement in response to the NLRB’s decision to name the company as a joint employer, stating that the NLRB’s complaints “improperly and dramatically strike at the heart of the franchise system,” and represent “overreach” by the agency. The company also said that it “will contest the joint employer allegation as well as the unfair labor practice charges in the proper forums,” and that McDonald’s independent owners and operators will contest the charges as well. The International Franchise Association has also lambasted the decision, with Matthew Haller, a spokesman for the International Franchise Association, stating that the NLRB’s decision, “would negatively impact small businesses across the country in a wide array of industries and business formats,” according to Bloomberg. Representatives from the Workforce Freedom Initiative of the U.S. Chamber of Commerce, the National Restaurant Association and the National Retail Federation have also come out against the NLRB’s decision.
Fast food worker advocates have come out in support of the NLRB’s decision. The Chicago Tribune reports that Kendall Fells, organizing director of the Fight for $15, said on a conference call that, “McDonald’s exerts such extensive control over its franchised business operations that, for all intents and purposes, McDonald’s is the boss…[i]t’s obvious that the company should share responsibility with franchisees for the treatment of its workers.”
According to the NLRB, if hearings related to the charges do not result in a settlement, litigation will begin on March 30, 2015 in Manhattan, Chicago, and Los Angeles. For more background on today’s decision, please revisit Professor Catherine Fisk’s initial post on the subject in response to the original announcement in July, Professor David Sherwyn’s response to Professor Fisk, and Professor Fisk’s follow-up.