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VOL. 129 | NO. 51 | Friday, March 14, 2014

McDonald's Hit by Lawsuits Over Worker Pay

CANDICE CHOI | AP Food Industry Writer

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NEW YORK (AP) – McDonald's workers in three states filed lawsuits against the fast-food chain this week, saying the company engages in a variety of illegal practices to avoid paying them what they're owed.

The suits in California, Michigan and New York against McDonald's Corp. and its franchisees come amid growing attention on the country's wealth disparities. While the type of violations outlined in the suits aren't specific to McDonald's, lawyers said they targeted the company because it's an industry leader.

Taken together, the suits seeking class action status could affect roughly 30,000 workers, lawyers said during a conference call arranged by organizers of the recent fast-food protests. They seek back pay and other damages.

The announcement of the suits came on the same day that President Obama directed the Labor Department to devise new rules that would expand the number of workers eligible for overtime pay. The White House, Democratic lawmakers and labor organizers have also been pushing to raise the federal minimum wage to $10.10 an hour, which translates to roughly $21,000 a year for full-time work. The current federal minimum wage is $7.25 an hour, or $15,000 a year.

McDonald's, based in Oak Brook, Ill., said in a statement that it is investigating the allegations and will take any necessary actions.

"McDonald's and our independent owner-operators share a concern and commitment to the well-being and fair treatment of all people who work in McDonald's restaurants," the company said.

The lawsuits detail a range of violations, including the use of company software that monitors the ratio of labor costs as a percentage of revenue. When that ratio climbs above a target, attorneys in Michigan said workers were forced to wait around before they could clock in. Workers in the state also were forced to pay for their own uniforms, which lawyers said reduced their already low wages.

In California, the violations cited included altered pay records and the denial of rest breaks. In New York, lawyers said McDonald's failed to reimburse workers for the cleaning of their uniforms in violation of state law.

The lawsuits target both franchise- and company-owned restaurants. McDonald's Corp. is named in all the suits, along with franchisees in some, because lawyers say the company exerts control over staffing at all its locations.

"There are a number of ways the two seem to work together," said Joseph Sellers, one of the attorneys representing workers.

The vast majority of the more than 14,000 McDonald's restaurants in the U.S. are owned by franchisees.

The workers named in the suits were referred to attorneys by the organizers of the recent fast-food protests that called for pay of $15 an hour. The Service Employees International Union has been providing financial and organizational support to that campaign, which has gained national media attention over the past year or so.

A representative for BerlinRosen, the public relations agency coordinating media efforts for both the fast-food protests and the lawsuits, said the timing of the announcement on the same day as Obama's overtime proposals was coincidental.

One of the suits was filed in New York, two were filed in Michigan and three were filed in California. An amendment to an existing lawsuit in California was expected to be filed Thursday.

Follow Candice Choi at www.twitter.com/candicechoi

Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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