A McDonald's Franchise owner is sick and tired of how the company does business, and has told the Washington Post all about the shady ways the company handles itself — including straight-up telling her she should pay her employees less.
Kitchenette readers are no stranger to the fact that McDonald's is several dozen kinds of fucked-up when it comes to how it treats its franchisees. But finding out the details makes it clear that it is so, so much worse even than I thought.
Kathryn Slater-Carter has owned a McDonald's with her husband in Daly City, California since 1982. She actually knew Ray Kroc growing up (her Dad was his realtor). She's also completely and totally fed up with the screwed-up way the company has handled its business since Kroc died and the other old guard execs died off or retired — so she shared all of the crap they pull with the Washington Post.
We've mentioned before that McDonald's charges franchisees rent — an unusual if not unique practice within the industry. But that actually undersells how screwed up it is: McDonald's leases are exclusively Triple Net Leases, meaning franchisees have to pay all costs associated with property tax, insurance, and maintenance. That's not in place of base rent — it's in addition to it. You also pay them advertising and promotion and PR costs, which is standard practice in the industry, except that at most places it's a percentage of sales (meaning you can never actually LOSE money on it).
Slater-Carter also shreds the absurd myth that the International Franchise Association (the ones you've heard whinging recently about the NLRB making the correct call regarding McDonald's being "joint employers" with franchisees) is anything but a shill organization designed to keep the parent companies' boot on the franchisees' necks:
We're fighting the International Franchise Association. The IFA was created to keep franchisees from getting any kind of legal rights. They use unsubstantiated FUD — fear uncertainty and doubt — to scare legislators. They say for example, that it will destroy franchising. They have an ad right now saying it will put 28,050 jobs at risk. I don't know which orifice of their body they pulled that out of. There's no facts to back it up, they just pulled this number out. In fact, 610 will ensure that small business owners have the ability to grow their business and keep people employed and pay a fair wage.
The most eye-opening part? McDonald's straight-up told her she should pay her employees less, once and for all giving the lie to the claim that they don't have any effect on wages:
And in our most recent Assembly hearing, I spoke about what I had been told by a McDonald's representative, which is that 'You guys can make more money if you pay your employees less.'
So what we've known all along is true: McDonald's claim that they have no control over their employees' wages (essentially, the real life ¯\_(ツ)_/¯) contains enough bullshit to fertilize every farm using propriety Monsanto technology.
Slater-Carter also isn't unreservedly pro-union, but she puts her finger right on the reason why the only thing worse than unions is what happens when you don't have unions:
[If McDonald's workers unionized], I think the biggest negative effect would be that corporations, the big guys, couldn't suck as much money off the top. I have mixed emotions on unions, and I told SEIU this. Sometimes I think the union benefits are a little over the top. But by the same token, in this stagnant economy that we've got, the little people are getting screwed. So I'm sure you know of the lawsuits for wage theft from the employees against McDonald's operators in California. Wage theft is wrong, and it comes a point at which people do need to protect themselves and their interests. If they're working, they deserve to be paid.
So there you have it. The long and short of it is that McDonald's (and really, the whole practice of franchising) is more kinds of screwed-up than a Mark Shrayber-reported porn trend. Good times.
Image via LesPalenik/Shutterstock.