7 fast-food chains agree to end ‘no-poaching’ policies

  • Jul. 12, 2018 8:25 p.m.

SEATTLE — Seven national fast-food chains have agreed to end policies that block workers from changing branches — limiting their wages and job opportunities — under the threat of legal action from the state of Washington.

Washington Attorney General Bob Ferguson announced binding agreements with the companies — McDonald’s, Auntie Anne’s, Arby’s, Carl’s Jr., Jimmy John’s, Cinnabon and Buffalo Wild Wings — at a news conference Thursday. McDonald’s had previously announced plans to end the practice.

The so-called no-poach policies prevent franchises from hiring workers away from other franchises of the same chain. That’s been convenient for franchise owners, who sometimes worry about workers they’ve trained jumping to nearby branches.

But it has also blocked experienced workers at one franchise from getting better-paying jobs at others, potentially keeping tens of thousands of employees around the country stuck in low-wage positions.

Without access to better job opportunities at other franchises, workers have less leverage to seek raises in their current positions, Ferguson said.

“Our state antitrust laws are very clear: Businesses must compete for workers the same way as they compete for customers,” Ferguson said. “You can’t rig the system to avoid competition.”

In separate agreements filed Thursday in King County Superior Court in Seattle, the companies denied that their policies are illegal, but said they wanted to avoid expensive litigation. McDonald’s said it was pleased to work with Ferguson’s office.

“We believe everyone at McDonald’s has an opportunity to grow and progress throughout their career,” the company said in an emailed statement.

Ferguson credited the businesses for quickly agreeing to end the practice nationwide in response to his legal threats and said fast-food chains that don’t follow suit will be sued. The seven chains have more than 500 locations in Washington.

The no-poach policies have been increasingly criticized by Democratic attorneys general and federal lawmakers. Sens. Elizabeth Warren of Massachusetts and Cory Booker of New Jersey wrote to the Justice Department last November expressing concern about their potential illegality. On Thursday they sent a letter to 90 business franchises — not just fast-food companies, but also mail services, fitness chains and more — seeking information about whether they have similar practices.

A coalition of 11 Democratic state attorneys general, led by Maura Healy of Massachusetts, this week announced a separate investigation into the no-poach agreements at several chains, including Arby’s, Burger King, Dunkin’ Donuts, Five Guys Burgers and Fries, Little Caesars, Panera Bread, Popeyes Louisiana Kitchen and Wendy’s.

Robert Cresanti, the president and chief executive of the International Franchise Association, said in a letter to lawmakers last month that many chains have already abandoned no-poaching policies.

But, he said, it remains important to protect the rights of the franchise owners as well as workers, and that such policies may remain necessary to protect training methods or the investment a franchise owner has made in training. In such cases, the policies should be applied in a limited manner so as to not restrict workers more than necessary, he said.

“IFA is confident that there can be a solution that protects brand value and, at the same time, ensures that a new generation of unit employees will continue to grow and advance, benefiting unit employees, franchisees, and franchisors alike,” Cresanti wrote.

Ferguson said his office began investigating early this year, prompted by a New York Times article detailing how such policies had stifled wages for fast-food workers.

Just Posted

RCMP on scene of collision near Rimbey

Hwy 53 down to one lane at collision scene

Is the fate of Red Deer’s Parsons House solely in the hands of the province?

Demolition of old police station next door to begin this fall

Fundraiser to help keep kids warm in Blackfalds

Community Warmth Fall Fundraiser

Piper Creek Foundation gets a new name

Red Deer subsidized housing program for seniors

Reveen returns to Red Deer

Presented by Friends of Red Deer Regional Hospital

WATCH: Red Deer students take part in annual run

Dawe/St. Pat’s Run reaches 40th anniversary

Man pleads guilty to ‘Field of Dreams’ site vandalism

DUBUQUE, Iowa — A man accused of driving onto and damaging the… Continue reading

Rafael Nadal to skip tournaments in Asia because of bad knee

MADRID — Rafael Nadal says he will not play in upcoming tournaments… Continue reading

Canadian crabs with bad attitude threaten coastal Maine ecosystem

BIDDEFORD, Maine — Canadians are known as friendly folks, but these crabby… Continue reading

UK lawmakers: ‘Wild West’ cryptocurrencies need regulation

LONDON — British lawmakers have backed calls for greater regulation of cryptocurrencies… Continue reading

Proposed class action lawsuit on trailing commissions filed against CIBC

TORONTO — A class action lawsuit regarding trailing commissions paid to discount… Continue reading

Saskatchewan family reunited with dog that bolted during July 2017 farm visit

MOOSE JAW, Sask. — A family in Moose Jaw, Sask., is overjoyed… Continue reading

Ex-aide is star witness of panel probing French crisis

PARIS — A former security aide of French President Emmanuel Macron who… Continue reading

German doctors: Pussy Riot poisoning ‘highly plausible’

BERLIN — German doctors treating a member of Russian protest group Pussy… Continue reading

Most Read