McCune Wright Arevalo, a Southern California employee and consumer law firm, has filed a class action lawsuit in federal court against McDonald’s USA, LLC and McDonald’s Corporation in the Northern District of Illinois. The lawsuit alleges that McDonald’s, which is a franchisor of thousands of independent restaurant stores, has both a written agreement and an unwritten policy that one franchise cannot hire current or former (for a 6-month period) employees of another franchise restaurant without that franchisee’s consent.
The lawsuit alleges that while McDonald’s fosters healthy competition for sales between franchises, it has implemented this antitrust “no-poach” agreement to restrict wage competition and artificially suppress employees’ wages.
The Class Representative in the case, Leinani Deslandes, was a victim of this practice. She was employed as a mid-level manager in a Florida McDonald’s franchise restaurant where she had not received promised promotions and raises for her valuable contribution to the success of the franchise. The lawsuit alleges that when she applied to another franchise that paid substantially more for the same position and had better promotion opportunities, she was told by the prospective franchise that they could not hire her unless she was “released” by her franchise owner, which was a condition of the McDonald’s franchise agreement. Her franchise employer refused to “release” her to the better paying franchise and continued to deny her promised raises and promotions. Because the fast-food industry is based on knowledge of the product, and more importantly, knowledge of the unique organizational systems, the experience and skills developed while working for McDonald’s do not transfer to other fast-food chains. As a result, after finally quitting her McDonald’s franchise, Ms. Deslandes was forced to start over with an entry level position in another industry at a substantially lower wage.
McCune Wright Arevalo partner, and lead attorney in the case, Richard McCune, states that this is an important case. “This practice of ‘owning’ an employee not only affected Ms. Deslandes and other employees where their franchise owner will not ‘release’ them, but it artificially holds down the wages of all of the McDonald’s workers that are being paid less than their true market value and are struggling to make ends meet. Meanwhile, McDonald’s stockholders, executives and franchise owners are getting rich off the backs of these workers. This is unfair, and a practice that should not be allowed to continue. We hope this lawsuit will stop this practice, which will in turn increase wages for tens of thousands of hard working McDonald’s employees, helping them to earn a fair and living wage for their families.”