Filed under: McDonald's, Retail, Labor, Food & Beverage, Restaurants
NEW YORK -- 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 (MCD) 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 Walmart Stores (WMT), have also announced pay hikes in an improving economy and at a time when worker issues are getting widespread attention.
Raising wages only a little for only a small fraction isn't change. It's a PR stunt.
"Raising wages only a little for only a small fraction isn't change. It's a PR stunt," said Kwanza Brooks, a McDonald's worker in North Carolina, on a conference call set up by organizers.
Protests were planned for McDonald's stores in about 24 cities across the country Thursday, although turnout for the events have varied in the past. In New York City, a crowd of about 30 people gathered outside a McDonald's across the street from the Empire State Building before marching several blocks to another McDonald's. Demonstrators filed into the location while chanting and waving signs with phrases like, "McDonald's: Where's My Raise?" before they were quickly ushered out by police.
A customer who was inside the store buying lunch, Rich Roman, said he didn't support the push and that he disliked unions.
"They make everything escalate in price," he said.
In addition to the push to raise public awareness, the Fight for $15 campaign, which is being spearheaded by the Service Employees International Union, has been pressuring McDonald's on multiple legal fronts. 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 accountable for labor practices at its franchised locations. McDonald's emphasized its position that it doesn't have control over employment decisions at those restaurants Wednesday when it said franchisees "make their own decisions on pay and benefits."
'Not Taking a Toll'
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.
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 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 said last month that a big part of the effort to turnaround the company's struggling U.S. business would be what it is doing "around the employment image and our employee-employer relationship."
-Associated Press Writer Josh Boak contributed to this report from Washington, D.C.
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