Outten & Golden: Empowering Employees in the Workplace

Posts Tagged ‘McDonalds’

Trump reversal of Obama-era labor rule is great news for corporations

Friday, June 23rd, 2017

A transgender woman is suing McDonald’s and the owner of the franchised restaurant she worked for after allegedly experiencing sexual harassment and discrimination.

La’Ray Reed said a coworker asked if she were a “boy or girl,” “top or bottom,” or what her “role” was “in the bedroom.” She said she was groped and spied on while using the public toilet.

But for Reed to hold McDonald’s responsible for her alleged mistreatment, her lawyers have to prove that McDonald’s should be held responsible as a joint employer—not just the owners of the franchised restaurant. There is a question of whether the Labor Department’s recent decision to rescind the standard for determining who is a joint employer will hinder her ability to seek justice. The Obama administration’s standard went beyond simply looking at who sets wages and hires people, and considered a worker’s “economic dependency” on the business.

McDonald’s has resisted this legal responsibility for many years, and says it does not have control over things like pay and working conditions at franchised restaurants. In 2016, McDonald’s settled a wage-theft class action through a $3.75 million payment that allowed it to dodge responsibility. McDonald’s released a statement that said it “reconfirms that it is not the employer of or responsible for employees of its independent franchisees.”

Industry groups have been pushing against efforts to call businesses like McDonald’s joint employers for many years now. In 2015, Matt Haller, a lobbyist at the International Franchise Association called a 2015 National Labor Relations Board ruling on whether a recycling company could be called a joint employer, “a knife-to-the throat issue for the franchise model.” He told the Washington Post, “You’d be hard pressed to find a business that shouldn’t be concerned about the impact of this joint employer standard.” Haller said IFA was “pleased” at the department’s decision to rescind guidance this month.

But there is certainly hope for La’Ray Reed, and other workers like her who are experiencing discrimination or issues such as wage theft at work. Since the joint employer guidance does not have the full force of law, it is not as important to these cases as existing tests for determining if an employer relationship exists. Under the economic realities test, applied under Title VII of the Civil Rights Act of 1964 and the Fair Labor Standards Act, among other laws, a relationship exists if someone is economically dependent on that business. Paul Secunda, professor of law at Marquette University, who teaches on employment discrimination law, said this test will play a much bigger role in determining whether an employee can hold McDonald’s responsible for discrimination.

“Just the Trump administration withdrawing this guidance does not mean in any way that these claims are doomed to failure or are otherwise are not plausible,” Secunda said. “Because what matters the most with employment law is focusing on employment discrimination under Title VII and what other state laws apply there.”

‘This control standard is the standard that has been in place since the 1950s and ‘60s, and so it doesn’t make sense to have different standards under different laws. It only makes sense to hold liable those who control what happens in the workplace,” Secunda added.

Representatives of Fight for $15, a group of fast food workers, teachers, and adjunct professors advocating for better pay backed by the Service Employees International Union, said McDonald’s has failed to enforce its own policies.

“The growing number of allegations suggests a failure by McDonald’s to enforce the zero-tolerance policy against sexual harassment outlined in its Operations and Training and Policies for Franchisees manuals,” the labor group told BuzzFeed.

“There are terms and conditions that are set by the national parent McDonald’s,” Secunda said. “It has a policy on sexual harassment and equal opportunity that all its franchisees have to meet: that it will not tolerate sexual harassment whether based on transgender status or otherwise in the workplace. [The argument is] that McDonald’s parent company exercises meaningful control—that is being free from sexual harassment and demeaning conduct in the workplace.”

None of this means that any parent corporation is responsible for any franchisees’ lability, Secunda said, since every case must be decided on its facts, but where employers do exercise meaningful control over employees, there should be a possibility that they will be held responsible.

The decision to rescind this joint-employer guidance will by no means kill any possibility of holding a corporation, such as McDonald’s, responsible, and a judge would be more likely to consider the rule of law first, Secunda said, but the joint employer guidance would still be a helpful resource for the defendant to have in its arsenal.

“If I were a conservative jurist who wanted it to come out on the corporate conservative side of the world, I see that they could use this. ‘You know they’re the expert agency, so they can’t be wrong,’” Secunda said. “But I just think that would be disingenuous, because the agency has obviously changed its position based on the politics on the administration. And this should be an answer that has nothing to do with politics. It should be based on rule of law.”

This blog was originally published at ThinkProgress on June 22, 2017. Reprinted with permission. 

About the Author: Casey Quinlan is a journalist covering education, investments, politics, crime, and LGBT issues.

McDonald's settles with franchise workers for $3.75 million in wage theft lawsuit

Tuesday, November 1st, 2016

LauraClawson

McDonald’s is still insisting it isn’t a joint employer of workers in franchise restaurants, but even so, it’s paying out millions to settle a lawsuit over labor law violations by a franchisee:

In a filing in U.S. district court in San Francisco on Friday, lawyers representing about 800 employees at five restaurants owned by a single franchisee said Illinois-based McDonald’s would pay the workers $1.75 million in back pay and damages and $2 million in legal fees. […]

The 2014 lawsuit claimed McDonald’s and the franchisee, Smith Family LP, violated California law by failing to pay overtime, keep accurate pay records and reimburse workers for time spent cleaning uniforms. The franchisee previously settled the claims for $700,000.

gettyimages-534355124

McDonald’s exerts tight control over how its franchisees do things it cares about. That happens not to include little things like obeying labor laws—but because McDonald’s control over how its franchisees do business is so well established, the National Labor Relations Board is moving toward treating McDonald’s as a joint employer. This settlement doesn’t settle that question, but at least these workers are getting a measure of justice.

This article originally appeared at DailyKOS.com on October 31, 2016. Reprinted with permission.

Laura Clawson is a Daily Kos contributing editor since December 2006. Labor editor since 2011.

 

Fight for $15 workers file sexual harassment complaints against McDonald's

Thursday, October 6th, 2016

LauraClawson

Workers who are underpaid are all too often exploited and abused in other ways—after all, their employers know they’re vulnerable and need the paycheck. So we should be shocked, but not too surprised, by the contents of sexual harassment complaints against McDonald’s that the Fight for $15 has filed with the Equal Employment Opportunity Commission:


Cycei Monae, a McDonald’s worker in Flint, Michigan, said a manager showed her a picture of his genitals and said he wanted to “do things” to her, according to a complaint provided by Fight for $15. Corporate officials ignored her complaints, Monae said on a phone call with reporters on Wednesday.

In another complaint, a worker in Folsom, California, said a supervisor offered her $1,000 for oral sex.

Thirteen of the complaints were by women, and two were by men, said Fight for $15, which the Service Employees International Union formed in 2012.

gettyimages-496499558Expect McDonald’s to once again fall back on its excuse that it can’t possibly control anything about what franchisees do to their workers, even as it controls every other aspect of how franchise restaurants operate. That control is why the National Labor Relations Board has said McDonald’s should be treated as a joint employer of workers in franchise restaurants.

Issues like sexual harassment are why the Fight for $15 isn’t just about $15 an hour pay—workers say they’re fighting for “$15 and a union.” A union could represent workers facing harassment and give them power in numbers and tools to fight back. This is a fight more broadly for power and respect. Money is part of that, but it’s not the whole deal.

This article originally appeared at DailyKOS.com on October 5, 2016. Reprinted with permission.

Laura Clawson is a Daily Kos contributing editor since December 2006. Labor editor since 2011.

After Ruling That McDonald’s Can’t Pay Workers In Bank Cards, The Bank Pays Up

Friday, June 5th, 2015

AlanPyke_108x108Paying employees through prepaid debit cards that incur fees when workers try to withdraw their cash is illegal in Pennsylvania, a judge ruled Tuesday. The lawsuit targeting a McDonald’s franchisee in the eastern-central part of the state has already prompted a powerful Wall Street bank to voluntarily give money back, a lawyer for the plaintiffs told ThinkProgress on Wednesday.

The case began in 2013 after a woman named Natalie Gunshannon sued a couple who own and operate multiple McDonald’s franchises in the state. The owners, Carol and Albert Mueller, had been using payroll debit cards provided by JP Morgan Chase rather than traditional paychecks or direct deposit payroll systems. After Gunshannon filed suit, the couple began offering direct deposit and traditional checks as alternatives to the payroll cards, which had previously been workers’ only option.

Gunshannon and other workers faced a $1.50 charge every time they used an ATM to access their wages, and a $5 charge for withdrawing the money over the counter at a cash register. Where a worker who misplaced a standard paycheck would be able to get a replacement check, the JP Morgan Chase prepaid cards charged a $15 replacement fee if lost or stolen. Paying bills online with the card meant spending an additional 75 cents on bank fees, and merely checking the balance of a card triggered a $1 fee.

The Muellers’ hourly workers were charged such fees nearly 47,000 separate times from the fall of 2010 to the summer of 2014, according to an expert witness in the case. That works out to roughly 20 separate fees per person in the class over a 45-month period.

Store managers, meanwhile, were offered direct deposit forms to receive their pay without facing the card fees.

When Gunshannon’s claim gained class action status earlier this year, all 2,380 hourly workers at the Muellers’ chain were able to join the case. Each of those workers would be entitled to a $500 damages payment plus the reimbursement of all the fees they were charged by the payroll cards, should the Muellers’ appeal of Tuesday’s ruling ultimately fail. In that case, the couple would have to pay out roughly $1.2 million in damages, unless they are able to strike a settlement with the workers’ attorneys.

Because the class action decision raised the stakes so significantly, that May ruling was in some ways a bigger deal than Tuesday’s finding that the Muellers had broken the law. The class status ruling in May certainly got Chase’s attention, plaintiffs’ attorney Michael Cefalo told ThinkProgress.

“Our lawfirm became bombarded with telephone calls. All of the class members were getting a form letter from Chase saying, we have decided to refund you all of the fees you have paid Chase,” Cefalo said. “We were shocked.” The voluntary payments from Chase ranged from as little as a penny to as high as $148, the attorney said. A call to the bank’s press office about the payments was not immediately returned.

The checks do little to shield the Muellers from the potentially backbreaking damages payments mandates by Pennsylvania’s Wage Payment and Collection Law. And while the money is nice, Cefalo said, it doesn’t erase what the McDonald’s franchisees and Chase did to his clients.

“Say I come up to you and I have an armed robbery, and then I say ‘I’m sorry, here’s your money back.’ I still committed a robbery,” he said. “You still paid ‘em the wrong way.”

The Muellers’ attorneys told Law360 they intend to appeal Tuesday’s ruling. They may yet succeed in persuading a different judge that the payroll cards fit the state’s definition of legal payment. In Tuesday’s decision, Judge Thomas Burke himself acknowledged that the relevant state law was written in 1961, and the technological progress in payments technology since then may cloud the case. He also asked the state’s Department of Labor and Industry to issue a formal administrative position on whether or not payroll cards that charge user fees are equivalent to cash or checks. The agency has previously said the cards are legal payment, but only in a non-binding advisory letter, according to Law360. A call to the agency for comment was not returned.

Payroll cards such as those the Muellers used are legal in many states, despite the fees that eat into workers’ wages. A handful of state legislatures are weighing new rules to govern the use of such cards, including Pensylvania itself and Washington state. The Consumer Financial Protection Bureau is working on regulations for a wide range of different prepaid debit cards including payroll cards like those in the Mueller case. The agency has warned employers that they must make alternative forms of payment available for any worker who doesn’t want the cards, and is currently soliciting comments on a proposed federal regulation.

With millions of Americans lacking access to banking services, the cards can be an important and beneficial tool for workers so long as they come with the right safeguards, the National Consumer Law Center has argued. Close to 5 million people were paid through such cards in 2012, a number projected to double by 2017. Similar prepaid debit cards are also being used in some cases to pay public benefits such as unemployment insurance. The banks that provide the cards and charge the fees are trying to recoup some of the profit they lost when Dodd-Frank regulations curtailed their old business practices involving fees for standard debit cards.

This blog was originally posted on Think Progress on June 3, 2015. Reprinted with permission .

About the Author: The author’s name is Alan Pyke. Alan Pyke is the Deputy Economic Policy Editor for ThinkProgress.org. Before coming to ThinkProgress, he was a blogger and researcher with a focus on economic policy and political advertising at Media Matters for America, American Bridge 21st Century Foundation, and PoliticalCorrection.org. He previously worked as an organizer on various political campaigns from New Hampshire to Georgia to Missouri. His writing on music and film has appeared on TinyMixTapes, IndieWire’s Press Play, and TheGrio, among other sites.

The Bizarre, Shania Twain-Based Argument For Keeping McDonald’s Wages Low

Wednesday, May 27th, 2015

AlanPyke_108x108It’s a good thing for pop music, honky-tonk feminism, and Canadian tax collectors that McDonald’s pays lousy wages. If the food stores paid their frontline workers enough to survive on, Shania Twain would still be working there, a shareholder claimed at the company’s annual meeting this week.

The unidentified man, who said he’d been a McDonald’s investor since 1990 according to BuzzFeed News, used a Q&A session to rattle off a list of successful celebrities like Twain, Amazon’s Jeff Bezos, and Hollywood star Sharon Stone who had worked in a McDonald’s earlier in their lives. “I’m sure if they were making $15 an hour, they’d still be working at McDonald’s,” he said, as thousands of current McDonald’s workers protested outside.

Twain has now been making music professionally for about as long as the anonymous commentator has held McDonald’s stock. But in high school, the future star worked at an Ontario McDonald’s. “I learned tons about the meaning of service there,” she told Time in 2002. As an elementary school-aged kid, she’d been singing in talent shows and open mics.

Twain’s parents were killed in a car crash when the singer was in her early 20s. She kept singing, now at a vacation resort, to support her three younger siblings. By 1991, she had a small contract with a Nashville country label. Her second album and subsequent hits made her a superstar by the late 1990s.

It is of course possible that the orphaned college-aged Twain would have stayed in the hamburger business instead of pursuing her musical talent. Attempts to contact Twain’s representatives were unsuccessful.

The minimum wage in the early 1980s in Ontario was about $2.85 an hour, in American dollars, which had the same buying power as $6.72 per hour today. McDonald’s recently committed to paying at least $1 above the local minimum wage in the roughly 10 percent of store locations that it directly controls, meaning that many of the company’s workers are already earning well above what Twain did even after adjusting for inflation.

It’s hard to fathom how moving those workers up to $15 an hour would generate such a comfortable living that frycooks with enough star power to get them noticed would instead settle for a career inhaling grease fumes. Someone working full-time without vacations at $15 an hour would earn about $31,200 per year, before taxes. But to survive for a year in Green Bay, Wisconsin — a blue-collar town across the Great Lakes from the mining town where Twain grew up — a family of two would need roughly $48,000 per year in income according to the Economic Policy Institute’s Family Budget Calculator. For the sort of household Twain lead after her parents’ deaths, with three children and one head-of-household, it’d take about $89,121 a year to afford housing, child care, health care, taxes, food, and transportation for the year in Green Bay.

 

$15 an hour wouldn’t support a family, then, but it would mean that McDonald’s workers could stop relying on food stamps and other public assistance programs. The company is only able to pay wages so far below the cost of living because anti-poverty programs are there to step into the gap. McDonald’s low wages are effectively subsidized by taxpayers to the tune of millions of dollars per year.

The shareholder’s broader argument — that McDonald’s is a stepping stone rather than a career, and that it pays accordingly — is similarly flimsy on the evidence. Low-wage jobs like these are far more likely to be a dead end than the opening stride up the career ladder. The common perception that most fast food workers are young people just starting into the job market is incorrect. Most are adults, not dependents making extra money over the summer to mollify their parents. And a full 20 percent of all American children has a parent like Alicia McCrary who works the kind of job that would benefit from a higher minimum wage.

McDonald’s is undeniably aware of how far away from economic security it leaves its people. Until recently, the company maintained a public website with a sample budget for workers that included such fanciful projections as spending $0 on heating a home and getting health insurance for $20 a month. It has also recommended that struggling workers sell their Christmas presents for cash to make ends meet.

 

McDonald’s continues to hold out against protests, strikes, and legal challenges to its business model after more than two years of sustained worker agitation for the higher wage and union representation. If the company won’t go to $15, the $15 hourly wage may come to it. This week, Los Angeles became the second American metropolis to adopt the $15 minimum wage, following in Seattle’s footsteps from last year. State and local governments elsewhere have been raising their minimum wage laws significantly in recent years as well. The momentum for significantly higher pay in service-sector jobs has already induced some major retailers to voluntarily raise their pay in the same limited way that McDonald’s has done. Competitors from Costco to Wegman’s to Seattle-area burger chain Dick’s Drive In have built their business model around paying a living wage and valuing workers as an asset rather than targeting them as a cost-cutting opportunity. And while fast food companies sometimes protest that they couldn’t afford to do business at a $15 hourly wage, that argument doesn’t impress economists much.

This blog was originally posted on Think Progress on May 22, 2015. Reprinted with permission.

About the Author: The author’s name is Alan Pyke. Alan Pyke is the Deputy Economic Policy Editor for ThinkProgress.org. Before coming to ThinkProgress, he was a blogger and researcher with a focus on economic policy and political advertising at Media Matters for America, American Bridge 21st Century Foundation, and PoliticalCorrection.org. He previously worked as an organizer on various political campaigns from New Hampshire to Georgia to Missouri. His writing on music and film has appeared on TinyMixTapes, IndieWire’s Press Play, and TheGrio, among other sites.

Not Lovin’ It: Thousands Storm McDonald’s HQ To Protest Low Wages

Thursday, May 21st, 2015

Terrance HeathIn the largest protest of its kind, thousands of McDonald’s employees stormed the company’s headquarters today to demand that it stop spending millions manipulating stock prices, and start paying workers a living wage. McDonald’s cashiers and cooks came to the company’s shareholders meeting, at its corporate headquarters in Oak Brook, Illinois. More than 100 were arrested for refusing to leave the property.

Marching with them were Service Employees International Union president Mary Kay Henry; Moral Mondays movement leader Rev. William Barber; Rev. Marilyn Pagán Banks of North Side Power/A Just Harvest in Chicago, Illinois; and Rev. Rodney E. Williams of the Swope Parkway United Christian Church in Kansas City, Missouri

The company, which banned media from its shareholders meeting on Tuesday, responded by shutting down its corporate headquarters.

McDonald’s is already under fire worldwide for dodging €1 billion in corporate taxes in Europe, and violating labor laws in Brazil. Now its in hot water back home for a share buyback scheme designed to inflate the company’s stock price, which means more money in the already well-lined pockets of shareholders and company executives. The company recently announced plans to return $18 to $20 billion to shareholders by 2016, through dividends and share buybacks.

Thousands of workers swarmed the company’s headquarters to protest McDonald’s spending nearly $30 billion manipulating stock prices instead of paying its workers a livable wage. Some carried blown-up copies of their paychecks to illustrate how little McDonald’s invests in its workers vs. how much is spends repurchasing shares.

Christine Owens, executive director of the National Employment Law Project released a statement in support of the protest:

“McDonald’s workers are rightly bringing the fight for $15 an hour and the right to form a union to their employer’s doorstep. For too long, the McDonald’s business model has served to enrich executives and short-term shareholders at the expense of workers and taxpayers. It’s time McDonald’s face the people who fry its fries and serve its customers but who are forced to pay for groceries with food stamps because McDonald’s does not pay them enough to feed their families.

“In the last decade, McDonald’s spent $30 billion on share buy backs—a widely discredited and short-sighted strategy to pump up the value of its stock. Spending billions on buybacks may provide short-term payoffs for a handful of rich investors, but it does nothing to benefit the company’s hundreds of thousands of employees, who are barely making ends meet. In fact, it misplaces resources that would be better used investing in growing the company or raising worker pay.

“More than half of fast-food workers are forced to rely on public assistance to support themselves and their families. McDonald’s costs taxpayers $1.2 billion every year in public assistance. McDonald’s is a $5 billion global corporation; its employees should not need to rely on food stamps, and taxpayers should not be subsidizing its profits.

“Today, as the workers protested, New York Gov. Andrew Cuomo’s Wage Board held its first hearing to significantly raise pay for fast-food workers across the state. And just yesterday, Los Angeles became the biggest city yet to vote for a $15 minimum wage, which is fast becoming a new baseline for workers across the country. The McDonald’s workers who are standing up and fighting for $15 and union rights are winning. This fight is not theirs alone—all of us have a stake in it. And when they finally get $15, all of us will be better off.”

The protest comes on the heels of the largest-ever strike against the fast food industry last month, when workers joined walkouts in 236 cities, as well as strikes and protests in 40 countries.

This blog was originally posted on Our Future on May 20, 2015. Reprinted with permission.

About the Author: The author’s name is Terrance Heath. Terrance Heath is the Online Producer at Campaign for America’s Future. He has consulted on blogging and social media consultant for a number of organizations and agencies. He is a prominent activist on LGBT and HIV/AIDS issues.

Inside the Case That Could Hold McDonald’s Responsible for Union-busting

Tuesday, May 5th, 2015

Andrew ElrodThe National Labor Relations Board’s (NLRB) complaint for unfair labor practices against the McDonald’s corporation inched forward in a Manhattan courtroom last month.

Lawyers representing the company, its franchisees, the Service Employees International Union (SEIU) and the government met to discuss the future of a case that could lay the groundwork for union representation and collective bargaining at the country’s largest fast food brand.

McDonald’s “entire business model is put at risk” by the litigation, Jones Day’s Willis Goldsmith told Administrative Law Judge Lauren Esposito during the three-hour hearing. If Esposito finds that the company’s oversight and workforce management policies make it a “joint employer,” as the charging parties contend, it could be held responsible for the working conditions in its franchised stores. Nation-wide, 90 percent of McDonald’s stores are owned by franchises.

During the hearing Esposito required McDonald’s to deliver over 700 documents relating to the structure of the corporation to the government and the union.

“The evidence will show that McDonald’s directed or helped direct how to deal with employees at the franchised facilities in response to protected activities,” said Jamie Rucker, General Counsel for the NLRB.

If the judge found coordination that established joint-employer status, the Board would be able to hold McDonald’s liable for illegally retaliating against workers who engaged in activity protected by the National Labor Relations Act in the Fight for 15 protests and organizing campaign, and eventually to be named as a party in collective bargaining for those stores.

But before that can happen, the board must prove that both McDonald’s and the owners of its franchised stores “share or codetermine those matters governing the essential terms and conditions of employment” or “meaningfully affect” employment issues such as hiring, firing, discipline, supervision and direction of work. The Board believes it can prove joint employer status with information from the shift scheduling software the company provides to its stores, as well as communications between company and individual locations. Evidence and testimonials are to be presented beginning May 26.

“McDonald’s is a complicated company”

While forcing McDonald’s to produce information about the management of its franchised stores, Judge Esposito did revoke subpoenas for information about a corporate-owned restaurant in Illinois. The Board and SEIU had sought the information to compare with management practices at franchised stores, where the company says corporate directives are considered “optional.” If management at both the franchised and non-franchised stores were sufficiently similar, Rucker argued, the “optional” suggestions from McDonald’s could be shown to establish joint-employer status.

Asked about the exact relationship between McDonalds Illinois, the subpoenaed store, and McDonalds USA, the national company, Goldsmith explained that “McDonald’s is a complicated company.”

The Board and the unions also requested details about McDonald’s USA’s corporate structure. But Jonathan Linas, also of Jones Day, explained that finding that information would not be so easy. “There’s no one organizational chart,” Linas said.

“The entire organizational structure of McDonald’s USA will not be produced,” he said. “I don’t know [if] it exists. We’ve been looking a long time and we don’t have one.”

Credible Allegation

The stakes of the proceedings are high and McDonald’s has hired the law firm Jones Day, which oversaw the bankruptcy and restructuring General Motors and the City of Detroit, to lead its defense.

McDonald’s business model in part rests on its exemptions from liability for the working conditions at its franchised stores. But even if these exemptions were to change, it is unclear what the implications for the rest of the fast food industry would be.

First, a finding of joint-employer status would have to survive in federal court, an institution notoriously unfriendly to workers’ collective action. And then it would only apply to the specific locations and conditions named in the complaint.

“As soon as there is some kind of a determination that an employer is a joint employer, the company just restructures the relationship,” says Michael Duff, a law professor at the University of Wyoming who worked at the NLRB for nine years. “And then you get another round of litigation.”

Because the joint-employer status would only apply to franchises named in the consolidated case, Duff explained, organizing campaigns through the NLRB could only occur at those stores. However, he added, an expanded joint employment standard could facilitate organizing at other similar franchises in the future.

“Once you have a broader way of thinking about the employment relationship, it opens up more kinds of workplaces to the credible allegation that this is a joint-employer relationship,” said Duff.

The charging parties are skeptical that McDonald’s workforce management systems can be restructured. Citing an April 2014 statement by then-CEO Dan Thompson, they allege the company has responded to falling profits with a “reset” plan that requires the company to take greater control of staffing and scheduling to maximize in-store revenues.

Guarded Campaigns

In its defense, the McDonald’s is arguing that any coordinated response at its franchised stores against protected activity was lawful-employer free speech, protected under the NLRA.

Under the 1947 Taft-Hartley amendments to the Act, Goldsmith explained, McDonald’s has “the absolute unfettered right to engage in non-coercive free speech in response to attacks on the brand.” Coordination on these grounds, he argued, does not constitute joint-employer status.

To establish its case, McDonald’s subpoenaed information on the internal workings of SEIU’s campaign, including internal documents from the union, the public relations firm Berlin Rosen and two investigative firms.

“We are entitled to find out who they talked to and what they spoke about,” Goldsmith said, referring to one of the investigative firms hired by the SEIU which may have spoken to workers. The union countered that revealing the insides of its campaign would have a “chilling effect” on organizing, as the fast food corporation could threaten those revealed with retaliation.  On Thursday, April 10, Esposito revoked the subpoenas against SEIU and the third parties.

Open-ended future

The pace of the proceedings since workers began protesting in 2012 also gives some sense of the scope of the campaign drive being led by SEIU.

Since November 2012, at least 310 charges of illegal retaliation against workers engaging in protected activity have been filed by workers and their representatives. Over 100 of these charges have been found to have merit, and as of February 13, the Board had filed 19 complaints across 14 administrative regions across the country—offices in Los Angeles, San Francisco, Phoenix, Minneapolis, Kansas City, St. Louis, New Orleans, Chicago, Detroit, Indianapolis, Pittsburgh, Atlanta, Philadelphia and Manhattan. As the protests have continued, so have the unfair labor practice charges filed by the union.

If McDonald’s is found to have coordinated a national response to protesting workers, as the Board is arguing, that could prove that the company exercises more control over the workers in its stores than it claims.

Such a finding would be initially limited and establish a legal basis for collective bargaining at just a handful of stores. However, the finding could facilitate traditional NLRB organizing across the heavily franchised service sector, forcing the company to bargain with workers who opt for union representation.

SEIU has made a considerable investment (“over $18 million at least,” said Goldsmith) in an open-ended campaign with little promise of immediate returns. The current case in front of the NLRB shows that the union is far from guaranteed from obtaining new dues-paying members any time soon, making the union’s investment an incredibly risky gamble—something most unions would be loathe to even consider.

The campaign has sparked a nation-wide movement that has already won minimum wage increases and raised entry-level pay for workers across the retail and fast food industries. Whether that momentum will translate into joint-employer status or fast food worker union membership may depend on the ruling handed down in Judge Esposito’s courtroom.

This blog originally appeared in In These Times on April 29, 2015. Reprinted with permission.

About the Author: The Author’s name is Andrew Elrod. Andrew Elrod is a writer living in New York. He is a contributor and former intern at Dissent, and his work has also appeared in Labor Notes. He is from Texas. Follow him on Twitter at @andrewelrod or reach him at elrod.andrew@gmail.com.

We Cannot Build a Strong, Equitable Economy on Low-Paying Jobs

Friday, August 9th, 2013

Mary Kay HenryWhat started out last fall as a one-day walkout at fast-food restaurants to protest poverty-level wages and stand up for basic human dignity has transformed into a movement that has captured the public interest.

I’ve been privileged, especially in recent weeks, to talk to institutional partners, policymakers and media about why low-wage workers across the country are risking their jobs and forgoing a much-needed day’s pay to work toward a better future for themselves and their families. We will be better off when hardworking people have enough money in their pockets to put back into their communities and generate more jobs, and SEIU members are proud to back these workers in their pursuit of economic justice and better lives for their families.

I traveled to New York City on Wednesday, to talk to Comedy Central host Stephen Colbert about the fast-food strikes. How in the world did this happen? I told Kendall Fells, an organizer from Fast Food Forward, it is because of the courage of the strikers, such as Shay Kerr and Shakira Campbell.

Shay has worked at McDonald’s in East Flatbush, N.Y., for six months. She earns minimum wage and, because sometimes her hours are cut for no reason, she can’t rely on a set pay every week. Since she cannot make ends meet on her wages, she has been bouncing around shelters. She’s fighting for a union so she can make a better life for herself and her 6-year-old son. Shakira is leading an action tomorrow at her store to be put back on the schedule. Their stories echo stories I’ve heard from workers all around the country.

Shakira, Shay, and many others who I have had the privilege of meeting in recent months are helping the public understand that, contrary to what some believe, these positions aren’t being filled by teenagers. Anyone who thinks they are is nostalgic for a time that no longer exists.

More than 4 million people work in the food service industry. Their average age is 28. Many of these workers have children and are trying to support a family. The median wage (including managerial staff) of $9.08 an hour still falls far below the federal poverty line for a worker lucky enough to get 40 hours a week and never have to take a sick day. According to the National Employment Law Project, low-wage jobs comprised 21 percent of recession losses, but 58 percent of recovery growth in the last few years.

This means middle-class jobs are disappearing while low-wage jobs are growing. If we simply accept this as fact, then the divide between the haves and the have-nots will only grow worse. And that is just wrong.

We cannot build a strong, equitable economy on low-paying jobs. Corporate profits are at an all-time high. McDonalds earned $5.5 billion just last year; other fast-food restaurants and retail chains are similarly profitable. They can afford to raise wages.

Americans have a long history of sticking together to fight for something better. SEIU can be proud of how we are fighting on so many fronts, from winning commonsense immigration reform, to delivering on the promise of the Affordable Care Act, to telling our elected officials to invest in vital public services, and to organizing in various sectors to make sure workers have a voice in the workplace. All of our members are involved in these campaigns to help workers strengthen and grow our union. As we do it, we know we have to reach out to the growing service sector of low-wage jobs in retail and fast food.

We are united to make a path to power for all workers; winning a just society; and leaving the world a better and more equal place for next generations to come.

This article originally appeared on SEIU blog on August 8, 2013.  Reprinted with permission.

About the Author: Mary Kay Henry is the International President of the Service Employees International Union (SEIU).

Can McDonalds Make A Profit While Paying $15 An Hour?

Thursday, August 8th, 2013

Bryce CovertWhile the average McDonalds employee in the United States makes just above the $7.25 minimum wage, that story is different in other countries. As Jordan Weissmann reports at The Atlantic, the minimum wage for full-time adult workers in Australia is $14.50 and McDonalds employees just negotiated a 15 percent raise by 2016. Yet the company has about 900 locations in the country.

Meanwhile, its profit margins at company-owned restaurants are higher in Europe than in the U.S. despite many countries there having a higher minimum wage. France’s minimum is about $12 an hour, and yet there are more than 1,200 locations there.

Residents of other countries pay more for their Big Macs, in part at least to make up for those extra costs, but the increase in prices is not drastic. Australians paid an average of $4.62 in U.S. dollars for a Big Mac in July and it cost $4.66 in the eurozone, while Americans paid $4.56. That’s a difference of about 6 to 10 extra cents, which would mean raising Big Mac prices a little over 2 percent in the U.S. to come equal with those in Europe.

Higher prices are related to the fact that the company does spend more on the cost of labor in other countries. In the U.S., it spends about 25 percent of its expenses on workers at the locations it owns, and franchises usually assume labor costs will take up about 30 to 35 percent. Worldwide, those costs have been found to come to closer to 45 percent of expenses. But the company reported nearly $5.5 billion in net income overall last year, up from about $2.4 billion in 2007, with more revenues coming from Europe than the U.S.

Australian locations have other ways to keep labor costs low, like exploiting a loophole that only requires an $8 wage for teenagers. Weissmann also reports that the company likely gives its higher paid European employees more responsibility and so ekes out more productivity from those workers. While productivity has risen in the U.S., wages haven’t.

But it’s clear, even to the company itself, that its American wages are not enough to get by on. It released a sample budget for employees that suggested paying nothing for heat, getting a second job, and spending just $20 a month on health care. While it claims to be an above minimum wage employer in the U.S., its average wages are mere cents more.

The inability to get by on its low wages has sparked pushback from workers across the country, with fast food workers striking in nine different cities. They are calling for a $15 minimum wage, the same as Australia’s, which is higher than President Obama’s $9 an hour proposal and Congressional Democrats’ of $10.10 an hour.

This article originally appeared on ThinkProgress on August 6, 2013.  Reprinted with permission. 

About the Author: Bryce Covert  is the Economic Policy Editor for ThinkProgress. She was previously editor of the Roosevelt Institute’s Next New Deal blog and a senior communications officer. She is also a contributor for The Nation and was previously a contributor for ForbesWoman.

We Are Worth More

Friday, May 17th, 2013

jack-metzgarLast month a few hundred retail and fast-food workers, from places like Sears, Dunkin’ Donuts, and McDonald’s, walked off their jobs for a rally in downtown Chicago.   Carrying signs saying “Fight for 15” (or “Lucha Por 15”) and “We Are Worth More,” these workers make $9 or $10 an hour, at best, and they figure they’re worth at least $15.

A one-shift walk-out and protest by a few hundred out of the thousands of such workers in the Chicago Loop and along Michigan Avenue’s Magnificent Mile cannot have the economic impact of a traditional strike – one that shuts down an entire workplace or industry for an extended period of time and, therefore, can bend an employer’s will.   And these workers’ chances of getting $15 an hour any time soon are worse than slim.   This “job action,” bolstered by community supporters organized by Action Now and with help from Service Employees International Union organizers, is more in the nature of a public protest than a “real strike.”   You could even call it “a public relations stunt,” but you’d be wrong to dismiss it as inconsequential.

“Public relations,” ironically, has a bad image.  But think of it as workers witnessing their own plight, calling for others in similar situations to join them and appealing to those of us with decent incomes to support them.  Witnessing, with its religious overtones, is not intended as an immediately practical action.  It’s first about individuals summoning the courage to put themselves forward to make a public claim that they are one of thousands (millions nationally) who are being treated unjustly.  In this case, it means taking the risk that they may be fired or otherwise disciplined for leaving work and going into the streets to proclaim “We are worth more.”

Witnessing is meant to make us think about justice as the witnesses simultaneously inspire and shame us with the courage of their individual actions.  I was at one of the first draft-card burnings that protested the Vietnam War in 1965, and I remember saying something like, “I’d do that if I thought it would do any good,” while knowing in my heart of hearts that I didn’t have the guts to take that kind of risk then.  But it inspired and shamed me – and thousands and then hundreds of thousands of others — to do many other things to fight against that war as we inspired and bolstered (and exerted peer pressure on) each other.

For the broader public, these initial job actions – in New York and Chicago among retail and fast-food workers; in California and Illinois among workers at Walmart warehouses; and all over the place amongWalmart retail workers – are “public relations” that raise awareness and pluck consciences.   But for workers who watched workmates walk off the job to witness for them, there may be some of that inspiration and/or shame that is a particularly powerful call to action. That’s what organizers are counting on, in the hope that the numbers of such workers will grow helter-skelter across the retail industry, eventually initiating a contagion of worker direct action that can put these workers in a position to negotiate for “labor peace,” with or without the blessing of the National Labor Relations Board.

There’s another determined witness who couldn’t be more unlike these striking workers.  He’s a retired law professor from the University of Texas, Charles Morris, who is a leading expert on the legislative and early administrative history of the National Labor Relations Act and the Board that enforces it.  In a 2005 book,The Blue Eagle at Work, Morris makes the legal case that the Act defined a labor union as any group of two or more workers who act together (“in concert”) to seek redress of grievances from their employer.   According to Morris, the “concerted activity protection” articulated in the Act means that employers cannot legally fire workers for forming a non-majority  or “members-only” union (as few as two workers acting together), and what’s more, an employer is legally bound to “bargain in good faith” with that union.

Through meticulous legal research, Morris has shown that these worker rights were in the Act from the beginning but have been forgotten by the subsequent customary practice of defining a union as only that group of workers who have formally voted to be represented by a petitioning union. What’s more, other legal scholars have now signed on to Morris’s legal interpretation and are ready to bolster it before an NLRB that is willing to hear their case.  There would be such an NLRB, what Morris calls “a friendly Board,”if Republican Senators would allow a vote on President Obama’s nominees for the Board.

A favorable NLRB ruling would be important for a variety of legally technical reasons that workers and organizers could use to their tactical and strategic advantage – none of which includes the expectation that employers will voluntarily obey the law just because it is the law. But equally important is that Morris’s reading of the Act’s history restores the original meaning of a labor union that is based on workers’ decisions to act together “in concert” with one another.  That is, a labor union is not just an institution with a bureaucracy and a marble palace in Washington, D.C., though it may be that as well.  It is any group of workers in any workplace, no matter how big or small, who decide to and then do act in concert to advance their own interests in their workplace.

In March Chicago Working-Class Studies helped organize a public forum that brought Charles Morris together with workers and organizers from Fight for 15, the Walmart retail and warehouse strikers, and two other groups who are already acting as unions under this definition.  Though there were some disagreements between the elderly legal scholar and the mostly young workers and organizers — one emphasizing the importance of politics and administrative case law in the long run, the others focused on the potential of direct action in the here and now – they agreed that if and when the two come together, the possibilities for a worker-led upsurge of union organizing are great.

Nonetheless, through their actions these workers have already changed what a labor union is and is thought to be.   It is now, and really always has been — even a century before the National Labor Relations Act was passed in 1935, even when it was an illegal “conspiracy” — simply a group of two or more workers acting in concert with one another.   To be really effective there will need, of course, to be many, many more than the hundreds and thousands who have begun this process.  But it starts with a few brave witnesses who take a risk and ask others to join them.  The peer pressure is now on the rest of us.

This article was originally printed on Working-Class Perspectives on May 6, 2013.  Reprinted with Permission.

About the Author: Jack Metzgar is a retired Professor of Humanities from Roosevelt University in Chicago, where he is a core member of the Chicago Center for Working-Class Studies. His research interests include labor politics, working-class voting patterns, working-class culture, and popular and political discourse about class.

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