·  Legal News, Analysis, & Commentary

Verdicts & Settlements

McDonald’s Settles Wage Theft Suit for $26m

— November 28, 2019

Although McDonald’s has agreed to settle, it won’t admit any wrongdoing.

McDonald’s has agreed to settle a wage theft lawsuit in California for $26 million.

According to CBS News, the tentative settlement resolves a years-long legal battle. First filed by Los Angeles-area employee Maria Sanchez in 2013, the suit quickly attracted additional support. The preliminary accord claims damages by about 38,000 workers across California.

In their complaint, the plaintiffs said that McDonald’s had begun instituting unfair practices as early as 2009.

Among the main claims was that McDonald’s broke California law on overtime. Under existing state law, employees must be paid overtime if they work more than eight hours in a 24-hour period.

However, McDonald’s enacted a time-keeping policy that let it cut some employees overtime pay. CBS notes that the company would track workers’ hours based on the day their shift started, rather than considering when work was actually performed.

Furthermore, the suit says that employees were often pressured to work without taking breaks. During peak hours, workers weren’t allowed to eat or briefly rest. Time off was only given at the beginning and end of shifts.

McDonald’s sign. Image via Flickr via Wikimedia Commons/user:Kenny Louie from Vancouver, Canada. (CCA-BY-2.0).

The suit, says CBS, was filed on behalf of McDonald’s employees working at corporate locations—in California and elsewhere in the U.S., the majority of McDonald’s restaurants are given corporate branding but are operated by private franchisees.

Employees have since voiced their satisfaction with the suit’s outcome, saying the fast food goliath got its due.

“McDonald’s cheated us out of tens of millions, but by standing up and speaking out, we’re holding the world’s second-largest employer accountable for breaking the law,” said Rosario Mercado, a Los Angeles-area McDonald’s employee.

In an e-mailed statement, McDonald’s told CBS and several other sources that, despite the settlement, it doesn’t believe it did anything wrong.

“While we continue to believe our employment practices comply with the California Labor Code, we have decided to resolve this lawsuit filed back in early 2013,” the company said.

“The parties have reached a mutually acceptable resolution and have submitted the settlement to the court for its review and approval,” McDonald’s said. “McDonald’s remains committed to our employees, and we continuously roll out additional trainings and resources across corporate-owned restaurants to promote continued compliance with all wage and hour laws.”

However, McDonald’s legal troubles are far from over. It’s facing numerous state- and national-level lawsuits, many brought by workers accusing the company of tolerating various forms of mistreatment against employees. In Michigan, a filing claims that McDonald’s has refused to discipline managers with sexual misconduct complaints against them; and in Chicago, workers say that productivity-oriented policies expose them to violence.

McDonald’s also continues to face internal pressure to raise its minimum wage to $15 per hour.


McDonald’s Agrees To Pay $26 Million To Settle Accusations Of Wage Theft

McDonald’s pays $26 million over claims it stole California workers’ pay

McDonald’s to pay $26 million to settle California wage lawsuit

Join the conversation!