Fast Food Giant McDonalds and the National Labor Relations Board

In late July, the National Labor Relations Board (NLRB) issued a complaint against McDonalds Corporation saying that McDonalds Corporation can be held accountable for employee rights violations of its franchise operators.  McDonalds fast food giant, like other fast food chains in the U.S. operate many of their restaurants on a franchise model for doing business.   In this business model franchise owners pay fees to the Corporate entity in exchange for permission to produce the fast food using corporate determined production methods, quality standards and sources for supplies and advertising.  Franchise operators have historically been considered independent from the Corporation when it came to supervising, hiring and firing their employees however.  With this arrangement, if an individual franchise operator illegally fired a worker for organizing the union, for example, the McDonalds Corporation itself was protected from facing liability for the illegal action.

As reported in the National Law Review (http://www.natlawreview.com/article/mcdonald-s-and-nlrb-not-so-golden-ar...), the NLRB is alleging that McDonalds Corporation is a joint employer along with the franchise owner since both entities together co-determine “essential conditions of employment such as hiring, firing, discipline, supervision and direction of employees.”

The NLRB has been investigating allegations of wrongdoing in the treatment of McDonald’s employees who have protested including engaging in civil disobedience in several major U.S. cities.  Workers are seeking the right to organize and increases in their wage rates.  Of 181 cases filed since November 2012, the Labor Board has found merit in 64 cases and those are now pending.