Posted by Elizabeth Gore-Jones
on 3 April 2024
McDonald’s finds itself in legal trouble once more as the Shop, Distributive and Allied Employees Association (SDA) initiates a class action lawsuit against the corporation and 325 of its franchisees in the Federal Court of South Australia. The lawsuit, seeking $100 million in backpay, alleges that over 25,000 supervisors and managers were not compensated for pre- and after-shift tasks.
These tasks, including cleaning, reviewing schedules and preparing equipment before shifts and balancing tills, safes and recording waste afterward, were reportedly obligatory but went unpaid. What is alarming is that this practice has persisted since December 2017, with claims dating back 30 years, suggesting a systemic problem within McDonald’s franchise network.
This lawsuit is also not an isolated incident. McDonald’s also faced legal scrutiny two years ago when it was accused of depriving employees of their mandated rest breaks. The SDA sought $250 million in damages and penalties, alleging a concerted effort by McDonald’s to encourage franchisees to circumvent labor regulations.
These legal challenges underscore the necessity for franchisors and franchisees to prioritize transparency, accountability and compliance with labour laws. It serves as a clear warning to ensure adherence to regulations to mitigate the risk of costly legal repercussions.
Should you encounter similar issues, seeking proactive legal counsel is imperative. Contact us today to safeguard your business's ethical, legal and operational integrity amidst evolving regulatory landscapes.
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