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Back to Drawing Board in NLRB/McD’s Deal


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A McDonald's restaurant in Laredo, Texas.

An administrative law judge nixed as “inadequate” and too narrow in scope the proposed settlement in the long-running saga between McDonald’s and the National Labor Relations Board over the joint employer issue.

The NLRB, which sought as far back as 2014 to hold the fast-food giant jointly liable with its franchisees for alleged wage and hour violations, and McDonald’s agreed this spring on the settlement. 

Opponents at the time called it a “sham settlement” that “does nothing to hold the $5 billion company accountable for violating its workers’ rights,” according to Mary Joyce Carlson, an attorney for Fight for $15 and the Service Employees International Union. In a statement yesterday, she added it would have handed the company “a get-out-of-jail-free card for illegally harassing, surveilling and firing minimum-age workers who joined together and spoke out for a better life.”

In a statement, McDonald’s said it is considering appealing the case to the five-member NLRB. It had called the proposal “fair, reasonable, and provides the opportunity now for full and complete relief to all current and former franchisee employees affected by the litigation.”

David Kaufmann, an attorney with Kaufmann Gildin Robbins who intently follows the joint employer issue, said in May that regardless of Judge Lauren Esposito’s ruling on the proposed settlement, the standard for declaring a “joint employer” will eventually revert to its pre-Browning-Ferris days, meaning exerting direct control, whether through court decisions, rule-making now going on at the NLRB, or similar means.

“It will not survive judicial challenge. It can’t. It so conflicts with the law,” Kaufmann said.

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The latest news, opinions and commentary on what's happening in the franchise arena that could affect your business.

Tom KaiserTom Kaiser is senior editor of Franchise Times. He can be reached at 612.767.3209, or send story ideas to tkaiser@franchisetimes.com.
 
Beth EwenBeth Ewen is editor-in-chief of Franchise Times. She can be reached at 612.767.3212, or send story ideas to bewen@franchisetimes.com.
 
Nicholas UptonNicholas Upton is restaurants editor at Franchise Times. He can be reached at 612.767.3226, or send story ideas to nupton@franchisetimes.com.
 
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Mary Jo LarsonMary Jo Larson is the publisher of Franchise Times Magazine and the Restaurant Finance Monitor.  You can find her on Twitter at
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