Law Offices of Louis Spitters

Significant win for fast food workers in employment compensation

The majority of fast food restaurants in California and elsewhere in the country are operated as franchises. In this business arrangement, a contract is made between the parent company and a franchisee, which generally requires that the franchisee pay a fixed, up-front cost and a continual percentage of sales. Typically, the franchisee is responsible for day-to-day business decisions, including the amount paid for employment compensation. However, a recent district court ruling may set a legal precedent that allows workers to file actions against a parent company if they do not feel their wages are paid appropriately.

According to an article written about this issue, McDonald's corporation has been sued many times over unfair labor practices. In the past, the McDonald's parent company has typically shifted blame onto the shoulders of the local franchisees when issues arise about overtime pay, time-card recording and the other wage issues. In the recent ruling, a judge ordered that a class action lawsuit could be formed for workers to pursue claims against McDonald's parent company.

Because of this recent ruling, employees working in the fast food industry or other franchise-heavy sectors may be able to bring labor lawsuits against large chains and corporations. The court also ruled that the parent company should be considered an ostensible agent in any labor disputes. Additionally, lawsuits against a franchisee could hold a parent company accountable for the actions of its franchisees.

Those in California who have experienced employment compensation issues could benefit from consulting an attorney to discuss possible legal options. In some cases, civil claims can be filed against employers for unfair business practices. Contacting attorneys who are experienced in employment law can be a positive step toward understanding the legal recourse available during what can be a frustrating time.

Source:, "The Latest McDonald's Lawsuit Is a Big Deal for Fast Food Workers", Virginia Chamlee, July 15, 2016

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