NLRB General Counsel to Name McDonald’s as Joint Employer
National Labor Relations Board (NLRB) General Counsel Richard Griffin has reportedly determined that McDonald’s, USA, LLC will be named as a “joint employer respondent” if meritorious complaints alleging unfair labor practices against the company and its franchisees do not settle. According to the NLRB, 181 cases involving McDonald’s have been filed since November 2012. Press reports indicate that they involve claims that workers have been wrongfully fired, threatened or suspended because they have engaged in labor protests, campaigning for a $15 hourly wage and to unionize. Sixty-eight of the cases have apparently been found to have no merit, and 64 are currently under investigation.
While Griffin’s advice memorandum to the NLRB’s regional offices authorizing 43 complaints brought by McDonald’s workers does not have the force of a full board ruling, it has sparked a firestorm of controversy among business interests. Noting that McDonald’s will contest the joint-employer allegation “in the appropriate forum,” a McDonald’s spokesperson said that the company “believes that this decision changes the rules for thousands of small businesses, and goes against decades of established law regarding the franchise model in the United States.” She also said in a memo to franchisees, “We will vigorously argue our case at the administrative trials and subsequent appeal processes which are likely to follow from the issuance of the complaints.” Other industry spokespersons reportedly characterized the decision as “outrageous” and an example of the Obama administration’s anti-small-business agenda.
An attorney representing McDonald’s workers in New York City said, “There’s really no doubt who’s in charge. McDonald’s can try to hide behind its franchisees, but today’s determination by the N.L.R.B. shows there’s no two ways about it; The Golden Arches is an employer, plain and simple.” An organizing director for Fast Food Forward, a Service Employees International Union-funded coalition seeking to organize employees in New York City’s chain restaurants, was quoted as saying, “As the federal government’s determination shows, McDonald’s clearly uses its vast powers to control franchisees in just about every way possible.” Some labor experts have commented that the general counsel’s decision could affect other industries that also follow a franchise model. See NLRB News Release, ABC News, The New York Times, and The Wall Street Journal, July 29, 2014; Law360, July 30, 2014.