Eight Fast-Food Companies Probed by State AGs Over Employee Agreements -- Update

   By Maria Armental 
 

Attorneys general from 10 states and the District of Columbia are investigating into "no-poach" agreements in the fast-food industry.

Such practices typically restrict workers from applying for jobs at other locations within certain areas or timeframes.

The attorneys general said Monday they have requested information, including franchise agreements and other related documents, from national chains Arby's, Burger King, Dunkin' Donuts, Five Guys Burgers and Fries, Little Caesars, Panera Bread, Popeyes Louisiana Kitchen and Wendy's.

In a statement, Wendy's said it does not impose any restrictions that prohibit franchisees from hiring or soliciting employees from other franchisees. "We do not have an 'anti-poaching' provision in our franchise agreement," it added.

The other companies weren't immediately available for comment.

"Our goal through this action is to reduce barriers and empower workers to secure better-paying and higher-skill jobs," Massachusetts Attorney General Maura Healey said in a statement. Ms. Healey is leading the investigation and is joined by attorneys general from the District of Columbia, California, Illinois, Maryland, Minnesota, New Jersey, New York, Oregon, Pennsylvania and Rhode Island.

As part of the investigation, the attorneys general have asked for documents showing the business rationale and any related communications, including training provided to franchisees or store managers regarding the agreements, and questioned what categories of workers have been subject to such restrictions, including job titles and hourly wages, the geographic or timing extent of the agreements and whether the workers were aware of the restrictions.

Ms. Healey's Fair Labor Division has also interviewed workers believed to have been affected by the agreements, including a McDonald's worker in Iowa.

Several lawsuits have been filed against fast-food companies challenging such agreements, including one filed last year by a Florida woman who worked as a mid-level McDonald's manager and challenged a McDonald's no-poach policy that prohibited workers like her to apply for a job at another McDonald's location within six months of having worked for another McDonald's.

That case, seeking class-action status, is pending in Illinois federal court.

McDonald's wasn't immediately available for comment.

"Many workers only learn these agreements exist when they are denied the chance to advance to a better job, earn more money or obtain family-friendly schedule options," Pennsylvania Attorney General Josh Shapiro said.

The attorneys general are also investigating whether any of those franchisees been a party to litigation or binding arbitration involving the no-poach agreements and what the resolution was.

Write to Maria Armental at [e-mail]

(END) Dow Jones Newswires

July 09, 2018 16:26 ET (20:26 GMT)

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