facebook pixal
Workforce

Critics say McDonald’s hasn’t kept its minimum wage promise

A labor-backed group says the company isn’t paying $1 above local minimums, something it promised in 2015.

McDonald’s isn’t living up to a 2015 promise to pay $1 above the minimum wage, according to workers and critics who’ve been pushing the chain to raise pay and unionize.

In 2015, McDonald’s said it would pay $1 an hour above local minimum wages at its company-owned locations, amid a period of increased competition for workers and demands for higher pay.

But Fight for $15, a labor-backed group formed in 2012 to pressure McDonald’s and other fast-food companies for higher pay, said on Monday that pay stubs in three metro areas with high concentrations of company stores shows the company isn’t fulfilling that promise.

The group said that workers in Chicago, Los Angeles and the San Francisco Bay Area are making less than $1 above local minimums. In Chicago, the group said, workers are earning “as little as $11.25 an hour” in a city where the minimum is $11. Cook County workers are making $10.35, the group said, while the minimum there is $10.

In Los Angeles, the group said, workers are making as little as $12.39. The minimum there is $12.

And in Northern California, workers are getting less than $1 above the minimum in San Jose and in Milpitas.

In a statement, McDonald’s said that the 2015 commitment was aimed at local minimum wages at the time, rather than a wage that would increase as minimums were increased thereafter.

“McDonald’s announced an increase in starting wages at our U.S. company-owned restaurants to be $1 above the local minimum wage on July 1, 2015, as part of an expanded benefits package that also included paid time off,” company spokeswoman Terri Hickey said in an emailed statement.

She added that the company expanded its tuition benefits at the time it raised workers’ pay. The company last week announced plans to invest $150 million in those benefits over the next five years.

McDonald’s increase in pay in 2015 was viewed as a sign of rising demand for labor in the restaurant industry and came as other companies such as Walmart were making similar moves. At the time, company executives said the increase in pay would help attract and keep better employees.

But the increase in minimum wages in many areas has rendered that decision obsolete in those places.

In Los Angeles, for instance, the minimum wage was $10 an hour at the time McDonald’s made its wage commitment. The wage in that county is headed for $15 an hour by 2021. Chicago’s minimum wage is moving to $13 an hour.  

McDonald’s 2015 increase only affected corporate stores, and the number of company-owned locations has decreased since then as the chain has sought to franchise more of its restaurants.

The company operated just 841 of its 14,036 U.S. locations in 2017, according to Technomic data. That’s down by more than a quarter from the year before, when McDonald’s operated more than 1,100 of its locations.

Fight for $15, backed by labor groups as well as the Service Employees International Union, was critical of the move at the time because it was only done at company stores and not at franchise locations—franchisees employ their own workers and largely set wages.

McDonald’s employees speaking for the group called the 2015 wage increase a “sham.”

“McDonald’s publicity stunt turned out to be a sham,” said Kayla Kuper, who is paid $11.40 an hour at a Chicago McDonald’s, in a statement for the organization. “We can’t take this company at its word. That’s why we need union rights, so that we can hold McDonald’s accountable and win the decent wage and basic benefits we need to support our families.”

Members help make our journalism possible. Become a Restaurant Business member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.

Trending

More from our partners