Judge approves McDonald’s franchisee’s $1.5M settlement in sexual harassment suit

Dive Brief:

Judge Hala Y. Jarbou on Tuesday approved a $1.5 million settlement by a McDonald’s franchisee in a class action suit filed by McDonald’s workers alleging sexual harassment by a Michigan store manager.
The class includes about 100 female employees, who will be awarded an average of $10,000 each.
While McDonald’s was initially a defendant in the suit, Judge Jarbou dismissed the company as a defendant in Dec. 2021, and found the franchisee to be the sole employer.

Dive Insight:

This settlement reflects McDonald’s attempts to distance itself from the legal problems of its franchisees.

“While this settlement is a win for dozens of Mason McDonald’s workers who claimed egregious harassment, it unfortunately doesn’t go as far as we would have hoped, because McDonald’s corporate wasn’t at the table,” Gillian Thomas, senior staff attorney at the American Civil Liberties Union Women’s Rights Project, per a BerlinRosen press release.

Former McDonald’s employee Jenna Ries filed the initial suit in November 2019. In 2021 a federal judge ruled that the complaint could become a class action suit.

McDonald’s has not generally been held responsible for labor violations or workplace problems committed by franchisees. In 2019, the NLRB found the chain was not responsible for alleged anti-union retaliation by a franchisee. Rulings and settlements that shield McDonald’s as a joint employer are a win for the company, whose track record with sexual and racial harassment complaints has been widely criticized by labor experts. The company has faced over over 100 suits and complaints alleging workplace sexual harassment since 2016, per the press release.

The chain has made recent attempts to improve restaurant safety and culture at franchised locations. In 2021, McDonald’s announced it would require sexual harassment training at all of its global restaurants beginning this year. Operators still retain some autonomy here, however — franchisees can select their own training programs even though corporate has made training materials available to operators.