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Despite Pay Bump, Labor Issues to Pressure McDonald's

The Fight for $15 campaign, which is being spearheaded by the Service Employees International Union, also shows no sign of backing off on the legal pressures it's putting on McDonald's

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    A pay bump for workers at some McDonald's restaurants isn't likely to ease the pressures the chain is facing over labor issues. (Published Thursday, April 2, 2015)

    A pay bump for workers at some McDonald's restaurants isn't likely to ease the pressures the chain is facing over labor issues.

    McDonald's said Wednesday it would raise wages for workers at its company-owned U.S. restaurants, which represent only about 10 percent of more than 14,300 locations. It also said it would offer paid time off for some workers.

    The move marks the first time McDonald's has set a national policy on wages, according to the company, and comes after it has been a primary target for ongoing demonstrations for pay of $15 and a union. Other companies, including Wal-Mart Stores Inc., have also announced pay hikes in an improving economy and at a time when worker issues are getting widespread attention.

    Immediately after the announcement by McDonald's, however, labor organizers denounced it as a publicity strategy that did little to improve the situations of workers.

    "Raising wages only a little for only a small fraction isn't change. It's a PR stunt," said Kwanaza Brooks, a McDonald's worker in North Carolina, on a conference call set up by organizers.

    Protests were planned for McDonald's stores around the country Thursday, and organizers also stressed the need for people to turn out for a day of broader demonstrations on April 15, which is set to include college campuses around the country.

    The Fight for $15 campaign, which is being spearheaded by the Service Employees International Union, also shows no sign of backing off on the legal pressures it's putting on McDonald's. This week, the National Labor Relations Board began a hearing on complaints that named McDonald's as a joint employer over alleged violations at franchised restaurants.

    The case is expected to be a lengthy battle and is a reflection of a primary goal of organizers: to hold McDonald's Corp. accountable for labor practices at its franchised locations. McDonald's has said it doesn't have control over employment decisions at franchised restaurants, and emphasized that position Wednesday when it said franchisees "make their own decisions on pay and benefits."

    In a phone interview, McDonald's USA President Mike Andres said few McDonald's workers have participated in the demonstrations and that the actions haven't hurt the company.

    "They're not taking a toll," he said.

    Instead, he said the decision to hike pay and provide paid-time off at company-owned restaurants was driven by the marketplace.

    "It's a very competitive environment and a significant rationale for this plan is that we want to be the most competitive and attractive employer," he said.

    Andres noted that many franchisees have already been providing higher pay to attract and retain workers.

    Beginning on July 1, McDonald's says starting wages will be a dollar more than the local minimum wage where company-owned restaurants are located. By the end of 2016, it said the average hourly wage for McDonald's workers at those stores will be more than $10 an hour, up from $9 an hour.

    The increase comes after more than a dozen states and multiple cities have raised their minimum wages last year, according to the National Employment Law Project.

    At company-owned stores, McDonald's says employees who have worked for at least a year and average of 20 hours a week will be eligible to accrue about 20 hours of paid time off a year.

    McDonald's Chief Administrative Officer Pete Bensen had hinted last month that an announcement regarding workers could be in the works. Bensen said at the time that a big part of the effort to turnaround the company's struggling U.S. business would be what the company is doing "around the employment image and our employee-employer relationship."

    For the past two years, sales and customer visits have slipped at established McDonald's locations in the U.S. 

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