McDonald’s Stiffs Employees On Promised Pay Raise

Fast food giant McDonald’s received a deluge of good press in 2015 when the company announced their plans to pay employees at least one dollar above the local minimum wage.

Now, almost three years to the day of that announcement, the few McDonald’s workers who are employed at corporate-owned restaurants have seen no action from the company and are still being paid just barely above minimum wage in their cities.

In a 2015 statement announcing the change, Chief Executive Officer Steve Easterbrook said “A motivated workforce leads to better customer service so we believe this initial step not only benefits our employees, it will improve the McDonald’s restaurant experience.”

The announcement, however, was widely criticized by labor experts at the time, who noted that the pay raise only applied to “company-owned restaurants,” which roughly constitute only about 10 percent of McDonald’s 14,000 U.S. restaurants. The rest are owned and operated by franchisees which make their own decisions when it comes to benefits and wages.

On Monday, a series of 16 recent pay stubs from McDonald’s workers at corporate stores in eight cities, shared by the “Fight For $15” campaign, reveals employees are receiving substantially less than the dollar above the minimum wage they were promised three years ago.

“McDonald’s publicity stunt has turned out to be a sham,” said Kayla Kuper, a McDonald’s corporate store employee in Chicago who is paid $11.40/hour when she should be paid a minimum of $12/hour. “We can’t take this company at its word. That’s why we need union rights – so that we can hold McDonald’s accountable and win the decent wage and basic benefits we need to support our families.”

In the greater Chicago area, the minimum wage is $11 an hour in the city and $10 in surrounding Cook county. According to the pay stubs, some Chicago employees are earning as little as $11.25 an hour and just $10.35 in Cook county.

“Instead of spending tens of millions plugging itself as ‘America’s best first job,’ maybe McDonald’s should use that money to keep its promise to me and the other workers it’s been stiffing,” said Fanny Velazquez, a corporate store employee in Los Angeles who is paid an hourly rate of $12.62, when the city minimum wage is $12 an hour.

Some Los Angeles-area corporate store employees are earning as little as $12.39 an hour.

According to McDonald’s, the 2015 announcement wasn’t meant to be a permanent fix as minimum wage floors in cities continued to rise. It only projected that the minimum wage for all employees at company-owned restaurants would be above $10 an hour.

That still provides little relief to McDonald’s employees, many of whom have long advocated for a $15 minimum wage, and are struggling to pay bills on a meager paycheck.

“They need to give us the dollar that they promised us,” Fanny Velaquez, a McDonald’s corporate employee for 10 years, told Bloomberg. “I can’t pay my rent or my bills.”

In response, the Fight for $15 launched a hotline Monday for McDonald’s workers who believe they have been slighted by the corporation.

McDonald’s failure to deliver on wage increase promises is another thorn in the side of a corporation that has been struggling to keep up with competitive wages in a tightening labor market. According to the National Employment Law Project, low wages at McDonald’s costs taxpayers roughly $1.2 billion a year because of the employees’ dependence on social safety net programs like food stamps and Medicaid to help cover costs that their wages cannot.

As Bloomberg has previously reported, McDonald’s is facing high rates of employee turnover as a result.

While McDonald’s continues to shirk its responsibility of paying employees a living wage, other retail chains are raising their minimum wage.  After raising the hourly minimum wage to $10 in 2016, Target raised it yet again in October 2017 to $11, with plans to increase it to $15 by the end of 2020. In 2016, Costco raised the minimum wage for new entry level employees to $13 an hour.

McDonald’s mistreatment of workers doesn’t end with low wages. In 2014, workers across three states filed a class-action lawsuit against the company, alleging wage theft — failing to pay workers the minimum wage, time-and-a-half for overtime, denial of meal periods and rest breaks, and mandatory unpaid work. That same year, propelled by the momentum of Fight for $15 protests, the federal government charged McDonald’s with illegally harassing and intimidating employees who went on strike for union rights and a $15 minimum wage. That case was ultimately settled by a Trump appointee to the National Labor Relations Board, allowing franchisees to continue to violate labor laws with no real repercussions for corporate McDonald’s.

Source: ThinkProgress.org