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Fast Food Workers File Lawsuit Against McDonald’s for Alleged Wage Theft

by Fatima HansiaCorpWatch Blog
March 21st, 2014

Protest outside McDonald's. Photo: Steve Rhodes. Used under Creative Commons license.

Over 25,000 low-wage employees working at McDonald’s franchises in California, Michigan and New York are being systematically cheated of their wages, say attorneys who filed seven simultaneous lawsuits last week against McDonald’s and its franchisees for violations of labor law.

Most McDonald’s fast food restaurants are franchises owned by local business people who buy supplies and branding materials from the company headquarters in Illinois. The company made $28 billion in sales last year that generated profits of $5.5 billion for shareholders.

“We work hard, and our wages are already at rock bottom. It is time for McDonald’s to stop skirting the law to pad profits. We need to get paid for the hours we work,” Sharnell Grandberry, a McDonald’s worker in Detroit who earns around $250 each week said in a press statement published by Cohen Milstein Sellers & Toll, one of the main law firms that brought the lawsuits.

The attorneys allege that

•    McDonald’s is “systematically stealing wages by forcing them to work off the clock, shaving hours off their time cards and not paying them overtime, among other practices.”

•    Franchise owners in Michigan and New York are not allowing employees lunch breaks that are required by law.

•    One lawsuit alleges that McDonald’s is violating New York’s minimum wage requirement of $9 an hour by making already underpaid workers pay out-of-pocket for uniform maintenance.

“Not only do its practices cause a substantial financial burden for McDonald’s workers,” says Richard Sellers, one of the attorneys who filed the lawsuits. “They violate state and federal minimum wage laws as well as other state labor laws. They highlight a broad array of unlawful pay practices, which together reflect ways in which McDonald’s has withheld pay from its low-paid workers in order to enrich the corporation and its shareholders.”

The company says it is “currently reviewing the allegations in the lawsuits” according to a statement emailed to the Guardian by Heidi Barkar Sa Shekhem, a spokeswoman for McDonald’s.

This is by no means the first time McDonald’s has come under fire for breaking labor laws. Just this month alone the U.S. Department of Labor ordered a Pennsylvania franchise restaurant to pay $211,000 in back wages to 291 employees and  the company was also fined approximately $500,000 for underpaying workers in seven franchise restaurants in New York.

The low wages paid by McDonald’s also affect taxpayers. A study published by the National Employment Law Project last year estimated that McDonald’s employees were forced to take total of $1.2 billion in public assistance to subsidize their lives.

"To put it in perspective, yesterday I got paid, today I have not a dollar in my pocket. It is so depressing,” Akilarose Thompson, a McDonald’s employee told the Guardian. Thompson gets paid $8.28 an hour, three cents above Illinois’ minimum wage, and works a second job at Red Lobster to support her 15-month old daughter.

The plight of McDonald’s workers has been highlighted as part of a larger nationwide campaign calling for higher minimum wage and living standards for the 2.9 million fast food workers. Activists like Fast Food Forward and New York Communities for Change and unions like Service Employees International Union are demanding that the federal minimum wage be raised from $7.25 an hour.

Beginning in November 2012, the activist groups have helped workers organize numerous day long strikes at individual McDonald’s in 58 cities around the country to put pressure on U.S. President Barack Obama to raise the federal minimum wage to $10.10 an hour.

Last July a group of 100 economists organized by the Political Economy Research Institute at the University of Massachusetts at Amherst signed a petition to raise the minimum wage to $10.50. “If a worker today is employed full time for a full 52-week year at a minimum wage job today, she or he is making $15,080. This is 19 percent below the official poverty line for a family of three,” the group wrote in their letter.

But some say that even $10.50 is not enough. “$15 is the bare minimum workers feel they need to live on,” said David Rojas of Chicago, an activist with a group called Fight For 15 told VICE News.

Not everybody McDonald’s is in the same boat, however. Don Thompson, the CEO, made $13.75 million, almost 750 times as much as his average employee.