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Offbeat 7 fast-food chains to end 'no poach' deals that lock down low-wage workers

20:52  12 july  2018
20:52  12 july  2018 Source:   nytimes.com

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Seven major restaurant chains , including Arby’s, Carl’s Jr., McDonald’s and Jimmy John’s, have agreed to drop a hiring practice that critics say may be keeping tens of thousands of fast - food workers locked in low - wage jobs.

Arby’s, Burger King and Wendy’s were among the chains . The restrictions, often referred to as no - poach clauses, do not stop The prevalence of the provisions has caused concern in some quarters that they may help explain the wage stagnation that has hit fast - food workers especially

Seven major restaurant chains, including Arby’s, Carl’s Jr., McDonald’s and Jimmy John’s, have agreed to drop a hiring practice that critics say may be keeping tens of thousands of fast-food workers locked in low-wage jobs.

Under agreements with Washington State announced on Thursday, the companies — Auntie Anne’s, Buffalo Wild Wings and Cinnabon are the others — have pledged to remove so-called no-poach clauses from their contracts with franchisees.

The provisions prohibit workers at, for example, one Carl’s Jr. franchise from going to another Carl’s Jr. They do not stop those workers from taking jobs at restaurants run by a different chain.

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"In the fast food industry, no - poach agreements can limit a worker 's future job prospects and restrict his or her earning potential, which is not only unfair to the The practice of restricting franchise owners from hiring workers from other locations in a particular chain has drawn criticism in recent years.

" No - poach agreements unfairly limit the freedom of fast - food and other low - wage workers to seek promotions and earn a better living," said Massachusetts Atty. Gen. Maura Healey, a Democrat, whose office is leading the investigation.

In addition to stripping the clauses from existing franchise contracts in Washington, the seven chains have also vowed not to enforce them nationwide — a move that affects workers at tens of thousands of stores. The clauses cannot be included in new and renewed deals either.

No-poach clauses have drawn scrutiny over whether they specifically hold down pay for restaurant employees — one of the largest segments of the United States’ work force — and also contribute to a broader wage stagnation that continues to plague the economy long after the end of the recession.

Many types of franchise businesses impose the clauses, but they may be most prevalent in the restaurant industry, and ubiquitous in the fast food sector.

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“My goal is to eliminate these provisions in all fast-food contracts in my state,” Attorney General Bob Ferguson of Washington, whose office reached the legally binding agreements with the seven chains, said in an interview this week. His office began investigating the issue several months ago after The New York Times published an article exploring how the clauses limit workers’ mobility.

The impact of the agreements negotiated by Mr. Ferguson’s office goes far beyond his state.

Unlike noncompete clauses, which job-seekers can review before signing hiring documents, no-poach provisions are buried in contracts between restaurant chains and franchisees, which independently own and operate the majority of stores. Workers at these stores may not even know they are bound by the restrictions until they try to land new jobs.

Franchise owners say the clauses help protect their investments of time and money in training employees. But a job offer from a prospective employer is often the best leverage with a current boss, and some economists worry that the provisions hinder people’s ability to exercise that leverage.

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" No - poach agreements unfairly limit the freedom of fast - food and other low - wage workers to seek promotions and earn a better living," said Massachusetts Attorney General Maura Healey , whose office is leading the probe.

Min- wage death: Fast - food worker tragedy exposes true cost of low -paid sector - Продолжительность: 2:45 RT 15 866 просмотров. Top 10 American Fast Food Chains - Продолжительность: 12:09 WatchMojo.com 1 496 327 просмотров.

Last year, the Princeton University economists Alan Krueger and Orley Ashenfelter published a study in which they estimated that no-poach clauses affected about 70,000 restaurants in the United States, or more than a quarter of fast food restaurants.

After examining the franchise deals of 40 of the country’s largest chains, Professor Krueger and Professor Ashenfelter concluded that no-poach restrictions appeared to exist mainly to limit competition and turnover, possibly depressing wages in the process.

“I’m pleased that the research that Professor Ashenfelter and I did has shined attention on this issue,” Professor Krueger said this week. “I hope that either through judicial action or legislation or voluntary decision by the franchise chains, that these noncompetitive practices are dropped.”

McDonald’s, the largest fast-food chain in the country by revenue, last year removed the clause in its franchise contracts, and said that it would not enforce them in existing contracts.

But some workers’ rights advocates have said McDonald’s did not always keep that promise. The company’s agreement with Mr. Ferguson’s office makes it legally binding.

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1. Fast - food workers are mostly teenagers working for pocket money. Fast food was indeed an adolescent gig in the 1950s and 1960s, when That adds up to some $ 7 billionin welfare payouts each year — essentially enabling fast - food mega- chains to subsidize ultra- low wages with public benefits.

Workers seek wage , union rights in protests in many cities. Fast food at other low -paid The activists, organized by the national Fight for campaign, briefly closed Union Avenue at about noon as they marched down Florence and then stood in front of In Detroit, fast - food workers , janitors

In a statement, McDonald’s said it was “pleased to cooperate” with Mr. Ferguson’s office. Jimmy John’s declined to comment. The other five companies did not immediately reply to requests for comment.

Maria Sanchez, 50, worked part time at a McDonald’s in Grimes, Iowa, this year. But she needed more hours than she was being scheduled for, so she found a job at a nearby McDonald’s that offered more shifts.

She said she had made it as far as orientation when a manager told her the store had learned that it could not hire her.

“I cried all the way until I got home,” Ms. Sanchez, who is originally from Mexico, said through a translator provided by the advocacy group Fight for 15. “I can’t survive with 25 hours a week.”

McDonald’s said on Thursday that it was unaware of Ms. Sanchez’s situation and was looking into it.

She had described her experience to staff members in the office of Massachusetts’s attorney general, one of 11 attorneys general who on Monday announced their own inquiry into hiring at eightfast-food chains, including Arby’s, to determine whether their no-poach clauses broke any laws.

Mr. Ferguson is not involved in that investigation, he said, because his was already well underway. He said his office was still examining hiring at other fast-food companies that operate in Washington. “Not all are as cooperative as these seven have been,” he said.

Ms. Sanchez, of Iowa, said she eventually got a job at a different McDonald’s.

“I never told them that I worked for another McDonald’s,” she said, adding that she recently left the new job after hurting her back. “I was scared to mention that I was working in another McDonald’s, because I need my job.”

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