McDonald’s hourly raise fails to satisfy its critics
Labour organizers have a message for McDonald’s: Nice try, but the protests will continue.
The “Fight for $ 15” campaign, which began calling for fast- food chains to raise wages and allow workers to unionize in 2012, wasn’t mollified by McDonald’s announcement Wednesday that it would boost pay.
In addition to protests scheduled for April 15, the group plans to gather outside McDonald’s restaurants on Thursday to criticize the company for not going far enough.
“There’s still millions of families in poverty due to McDonald’s not raising to $ 15,” said Kendall Fells, the campaign’s organizing director. “We’re going to show McDonald’s this movement won’t stop until we get what we deserve.”
McDonald’s said Wednesday that it will raise pay at U. S. companyowned stores, which account for about 10 per cent of its more than 14,000 domestic locations, by at least $ 1 above the local minimum wage. The Illinois- based company also will begin offering vacation benefits as part of the plan, which takes effect on July 1.
By the end of 2016, the fast- food chain expects workers at companyowned locations to earn more than $ 10 US an hour on average. McDonald’s said about 90,000 employees would get the raises. The approximately 660,000 employees at the 90 per cent of U. S. restaurants run by franchisees will not.
In its pledge to improve pay and benefits, McDonald’s joined a growing roster of major U. S. employers. In recent months, walmart Stores, Target Corp. and TJX Cos. have all vowed to boost pay to at least $ 9 US an hour this year.
McDonald’s higher wages at company locations could force franchisees to follow suit, particularly if they’re operating in a market alongside restaurants owned by the corporation, said Richard Adams, a fast- food consultant and former franchise owner. In the end, that could be good for McDonald’s, he said.
Higher wages would force franchisees to raise prices, which would mean higher royalty payments sent back to the corporation.
The pay hike marks a dramatic early move for new CEO Steve Easterbrook. After his promotion to the top job last month, Easterbrook has been working to reignite growth at the fast- food chain. Other efforts include a test of all- day breakfast at San Diego restaurants and an touch screen system that lets customers customize burgers and sandwiches.
McDonald’s has been grappling with sluggish sales in its home market and a health scare in Asia.
The pay raise is part of a push to transform McDonald’s into a modern, progressive burger company, said Peter Saleh, an analyst at Telsey Advisory Group in New York. That means good food, updated restaurants and better service, he said.
“If you’re going to underpay your people, I don’t see how you can have great service,” he said. “They had to do something.”