Labor rights advocates claim a Tuesday ruling was a big victory, after an agency said McDonald’s corporate, central operations could be lumped together with its thousands of franchises to use for liability purposes.
The largest chain of fast food restaurants in the world promises it will fight the National Labor Relations Board’s decision that McDonald’s said changed the rules for many small businesses.
The NLRB determined that 43 out of 181 complaints that had been filed since November of 2012 had merit to move ahead. Of the 43 where complaints were authorized, franchisees and or McDonald’s LCC, which is the corporate central entity, will be the respondent if the parties cannot reach a settlement.
The statement from the NRLB does not make it clear the number of cases that involved locations that are franchised. Sixty-eight of the cases did not have merit, while 64 were pending an investigation, said the NLRB.
Protests regarding pay at the fast food chain have gained much traction over the past few months. Several workers at McDonald’s were arrested after protesting at the annual shareholders meeting last May.
McDonald’s had approximately 3,000 franchises inside the U.S. and has over 14,000 restaurants located in the U.S.
The most important part of the NLRB decision was the term joint employer. That term, said one attorney, could apply to a corporate entity and therefore linking it with the franchises.
The attorney is a former board member on the NLRB and was a board member of the attorneys coordinating committee of the AFL-CIO.
A spokesperson for McDonald’s said the company believes the decision changes the regulations for many hundreds of small businesses as well as goes against years of established law with regard to the financial model in the U.S.
The McDonald’s spokesperson said that the fast food behemoth, along with every company involved within the franchising industry, relies on the existing rules to operate a successful business within the framework of a system that each day creates substantial employment and business opportunities throughout the country.
Get Analysts' Upgrades and Downgrades Daily - Enter your email address below to receive a concise daily summary of analysts' upgrades, downgrades and new coverage with MarketBeat.com's FREE daily email newsletter.