NLRB Federal Ruling on McDonald’s Just Turned Franchising Upside Down | Inc.com


mcdonalds_39120In a move that could ultimately have a huge impact on all franchising, the general counsel of the National Labor Relations Board has said that McDonald’s is the joint employer of workers at its franchise locations. If ultimately upheld, that could put McDonald’s at the epicenter of class action suits over fast food worker wages and working conditions.

Traditionally, franchise owners themselves were considered sole employers of their workers. Because they operated as separate legal entities, franchisors were isolated from any labor disputes. By declaring that McDonald’s is a joint employer, the NLRB has shaken that structure.

“Corporations that exercise sufficient control over their franchisees cannot claim ignorance,” said Catherine Ruckelshaus, general counsel and program director for the National Employment Law Project, in a Tuesday conference call held by the organizations supporting the lawsuits. “This accountability means ensuring that the franchises comply with the basics of the law.”

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