A federal judge in Chicago has rejected McDonald’s USA’s claim that a former employee lacked standing to bring a lawsuit accusing the fast-food giant of violating federal antitrust law by requiring franchisees to sign no-poach agreements, reported Reuters.
US District Judge Jorge Alonso on Friday, April 23, named plaintiff Stephanie Turner, represented by McCune Wright Arevalo, had adequately alleged that the agreements between franchisees and corporate-owned McDonald’s restaurants depressed her wages in violation of the federal Sherman Act.
The case argues that as part of McDonald’s system to maintain its significant competitive advantage, together with its franchisees, McDonald’s has colluded to suppress the wages of the restaurant-based employees who work not only at McDonald’s restaurants in Ohio or Kentucky, but also throughout the United States. In particular, McDonald’s and its franchisees have contracted, combined, and/or conspired to neither hire nor solicit each other’s employees.
According to Peter Cappelli, Wharton management professor and director of Wharton’s Center for Human Resources, no-poaching agreements are unfair to employees and such a pact “benefits the companies at the expense of their employees.” Mr. Cappelli noted that the reason such agreements are illegal and violate both antitrust and employment laws is because “[c]ompanies could achieve the same results by making it attractive enough for employees not to leave.”
Full Content: Reuters
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