Dive Brief:
- McDonald's is giving employees at company-owned restaurants a bonus equal to 10% of pay earned in May, according to an internal memo obtained by Business Insider.
- The chain said that the policy was inspired by franchisees, who have also provided enhanced benefits during the outbreak, including appreciation pay, bonuses, gift cards and raises.
- In an April 9 letter also obtained by the publication, McDonald's U.S. president Joe Erlinger urged franchisees to create an emergency relief fund for employees, as well as 10% "hero pay" and paid leave.
Dive Insight:
McDonald's isn't the first major restaurant to increase pay during the pandemic, although the announcement comes as the chain continues to receive pushback for some of its labor policies, as well as its generous exit package for former CEO Steve Easterbrook.
Its pay stance, in particular, has come under scrutiny over the last year as it settled a class-action lawsuit in April 2019 in California that involved its corporate stores and wage and hour violations. It's also been a strong opponent of the proposed $15 minimum wage hike until this past August when it abandoned its fight.
According to Business Insider, McDonald's had been considering rewarding employees for working during the coronavirus crisis for several weeks.
The world's largest fast food chain joins other companies like Starbucks, Chipotle and Wendy's in boosting the pay rate of its hourly workers during the outbreak. Starbucks is offering an extra $3 an hour for employees at its own stores and Chipotle increased pay 10% through May 24. Wendy's recognition pay includes a 10% increase in hourly wages for five weeks beginning April 1.
The pandemic has forced a brighter spotlight on the pay and sick leave policies of the service industry, from restaurants to grocery stores. Early during the outbreak in the U.S., McDonald's implemented a new policy to offer 2-weeks of paid leave for workers at corporate-owned stores. However, like the 10% bonuses offered now, this impacts less than 5% of the chain's restaurants in the nation, according to Restaurant Business.
