U.S.

NYC McDonald's restaurants settle workers' class-action lawsuit

Franchise owner agrees to pay $500,000 to current and former employees for alleged labor-law violations

Fast-food workers demonstrate outside a McDonald's restaurant in NYC on March 18, 2014.
Cem Ozdel/Anadolu Agency/Getty Images

NEW YORK — Ongoing litigation targeting fast-food restaurants for alleged labor-law violations yielded a significant victory for low-wage workers in New York City on Tuesday. A McDonald’s franchise owner settled a lawsuit in the amount of $500,000 for unpaid laundry allowances, uncompensated work time and unlawful wage deductions.

Richard Cisneros, owner of seven McDonald's restaurant franchises, agreed to compensate 1,600 current and former employees for failing to pay legally-required stipends to launder their Golden Arches uniforms, enforcing unlawful wage deductions for covering cash register shortfalls and unpaid overtime incurred between 2007 and July 2013, according to a statement published on New York State Attorney General Eric T. Schneiderman’s website.

Schneiderman commented, “Like every other business in New York State, fast food employers must follow our labor laws.”

“Our lowest wage workers deserve the same protections of the law as everyone else. It’s critical, for them and for their families as well as for our economy, that we remain vigilant so that no New Yorkers are cheated out of their hard-won earnings.”

Rosa Rivera, 47, who emigrated from El Salvador 14 years ago and took a job at McDonald’s, said in a statement she never dreamed she’d still be living in poverty today.

“I’m still making less than minimum wage because of wage theft. I’ve washed my uniform multiple times a week for years, all on my own dime,” she said. “The law says I should be getting an extra $7.85 to help recoup the cost of trips to the laundromat, but that never happens."

Kendall Fells, organizing director of workers’ group Fast Food Forward, told Al Jazeera the settlement marked an important victory in raising awareness about workers’ rights.

“It’s bigger than any one of us thought it was going to be,” he said.

“A lot of these minimum-wage workers didn’t even realize they’re making less than the minimum wage. If you clock out of your shift and your manager asks you to do 1.5 [additional] hours of work, you’re working for free. That’s what these workers are starting to realize, ‘we thought we were doing badly because we're making the minimum wage, but a lot these times we’re making even less.’”

Fells, who worked at a Taco Bell and a McDonald’s restaurant himself for about two years, said the workers’ grievances are similar to his own experience at the fast-food chains, where he said he was regularly asked to work extra hours or pay back the register from his own money. “I didn’t know this was illegal,” he said.

McDonald’s also faces class-action lawsuits in Michigan and California for alleged wage theft.

A statement posted to McDonald's website said it took the allegations seriously.

“McDonald’s and our independent owner-operators share a concern and commitment to the well-being and fair treatment of all people who work in McDonald’s restaurants," said Heidi Barker Sa Shekhem, a company spokesperson.

"McDonald’s and our independent owner-operators are each committed to undertaking a comprehensive investigation of the allegations and will take any necessary actions as they apply to our respective organizations," she added.

McDonald’s could not be reached for comment at time of publication.

In another move to galvanize the workers’ movement, NYC public advocate Letitia James announced at a fast-food protest on Tuesday that she will propose legislation to create an anonymous hotline to report wage theft. The protest was one of 33 that took place across the country on Tuesday.

"It's hard enough for low-wage workers to survive in this economy. It's practically impossible to do so while your wages are being stolen. The instances of wage theft in New York City and around the country are becoming too many to ignore,” James said in a statement. 

“My office will establish a hotline for whistle-blowers to report wage theft and we will empower city agencies with the ability to investigate those claims.”

Fells said the hotline will enable union organizers to identify new cases of labor abuses. In 2012, a survey found 84 percent of fast-food employees in New York City were “getting their money stolen from employees,” he said. “This is a national problem for the industry as a whole.”

Nation-wide protests against low wages and poor working conditions gained considerable traction since September 2012, when fast-food workers began walking off their jobs to make their dissatisfaction known. In November, hundreds of workers across the country joined others to demand their wages be raised to $15 per hour.

The federal minimum wage is $7.25 per hour, but that’s so low Fells said many workers he surveyed “cannot afford affordable housing anymore.”

“(Employers are) taking the money out of the workers' pockets and putting it in the pockets of the billion-dollar fast-food industry," he said.

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