The working off the clock and wage theft suits filed last week against McDonald's in California, Michigan and New York involve an interesting legal theory: the plaintiffs claim that the parent corporation of McDonald's is a joint employer with the franchisees and therefore liable to pay the wages and overtime the lawsuits seek. In an excellent article about the suits on MSNBC, Timothy Noah identifies the following factors as the bases for these claims:
- HR Bot -- franchisees are required to buy and install a human resources software program from McDonald's that keeps track of sales, inventory and labor costs. If a manager goes into the system and reduces an employee's recorded work hours (an action that would suggest straight-out wage theft), the information goes back to the McDonald's parent corporation office.
- Firing - the plaintiffs claim that McDonald's has fired franchisee employees.
- Recruiting and hiring - McDonald's maintains a web site in each state at which it accepts job applications for both company owned and franchisee-owned stores. Before passing the applicant's info on to a franchisee, McDonald's assigns a score to the applicant.
- Monitoring of Wage Costs - McDonald's tracks how often the franchisees review their wage costs and provides a form for franchisees to use in this review.
- Consulting - McDonald's regularly sends its employees to serve as consultants for franchisees advising them on, among other things, controlling labor costs.
At the bottom, the suits claim that the McDonald's parent corporation has been complicit in the wage theft and working-off-the-clock violations that are at the heart of the case. The question ultimately is whether McDonald's role in the franchisee personnel matters gives it legal status as a "joint employer" of the employees. If so, it would be liable for the unpaid wages and overtime. Could it be that the fast-food business model is significantly dependent on wage theft and forcing employees to work-off-the-clock?
Lexington, Kentucky wages and overtime lawyer Robert Abell represents individuals and employees seeking to recover the wages and overtime they've earned but not been paid; contact him at 859-254-7076.
