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"The general counsel of the National Labor Relations Board on Tuesday ruled that McDonald\u2019s \n\t\t\t\t\n\t\t\t\t\t\n\t\t\t\t\t\tMCD\n\t\t\t\t\t\t\n\t\t\t\t\t\n\t\t\t\t\n\t\t\t qualifies as a joint employer of workers at its franchise restaurant locations, a decision that\u2014if upheld\u2014could hold the company responsible for employee conditions and ease the fast food industry\u2019s path toward unionization.\nMcDonald\u2019s disputed the decision and said that it plans to contest it. Its senior vice president of human resources Heather Smedstad said in a statement that the ruling \u201Cchanges the rules for thousands of small businesses, and goes against decades of established law regarding the franchise model in the United States.\u201D About 90% of McDonald\u2019s 14,000 restaurants in the United States are owned by franchisees.\nThe ruling came in response to 181 unfair labor practice complaints filed in New York by the Fast Food Workers Committee (which is funded by Service Employees International Union), which accused McDonald&amp;#8217;s of retaliating against workers who took part in organized activity. Finding that 43 of those complaints had merit, NLRB General Counsel Richard Griffin said that he would include McDonald\u2019s as a joint employer in those cases going forward.\nThe ruling could spell potential upheaval for the fast food industry, which for decades has largely operated under the franchise structure, a scenario in which franchise owners are responsible for a restaurant\u2019s day-to-day operations, pay royalties to a corporate overseer and follow the management guidelines that the mother corporation hands down. The retail industry employs the franchise system too and Tuesday\u2019s decision prompted outrage from its largest industry group. \u201CThe last thing this economy needs is decisions like this which merely serve to stall job growth and diminish much needed capital investment,\u201D the National Retail Federation said in a statement.\nMcDonald\u2019s said on Tuesday that it relies on the franchising model to \u201Crun successful businesses as part of a system that every day creates significant employment, entrepreneurial and economic opportunities across the country.\u201D\nBut ever since fast food workers started pressing for a $15 per hour wage two years ago, McDonald&amp;#8217;s and other chains have also used the system to skirt responsibility amid outrage over low worker pay, claiming that they don&amp;#8217;t set worker wages; franchise owners do. In its statement on the minimum wage, for instance, McDonald\u2019s says that it bases its worker compensation on local markets and employees\u2019 job levels. But it also relies on this point: \u201CIt\u2019s important to know approximately 80% of our global restaurants are independently owned and operated by small business owners, who are independent employers that comply with local and federal laws.&amp;#8221;\n\nTuesday\u2019s directive weakens that defense and gives credence to labor organizers who have long argued that McDonald\u2019s should be considered an employer because it controls so much of the operations at its franchise locations and leaves the franchise owners little freedom to make changes, including raising wages.\nThe decision could have a big impact on fast food worker wages. If the decision is upheld, it means McDonald\u2019s can be found liable for violating fair labor practices that had previously been reserved for franchisees, according to Catherine Ruckelshaus, general counsel of the National Employment Law Project, who spoke on a press call organized by the Fast Food Forward campaign.\n\u201CMcDonald\u2019s can try to hide behind its franchisees, but today\u2019s determination by the NLRB shows there\u2019s no two ways about it: The Golden Arches is an employer, plain and simple,\u201D said Micah Wissinger, an attorney who brought the case on behalf of McDonald\u2019s workers in New York City, said in a statement.\nIn addition to better pay, the fast food worker movement is also seeking the right to organize, and Tuesday\u2019s ruling could potentially give a boost to that effort as well, says Kate Bronfenbrenner, director of labor education research at the Cornell University School of Industrial and Labor Relations. \u201CMcDonald\u2019s was saying it wasn\u2019t an employer; it can\u2019t say that anymore,&amp;#8221; she says. &amp;#8220;It\u2019s no longer a debate.&amp;#8221;\nWATCH: McDonald&amp;#8217;s is responsible for employee treatment, Labor Board Rules"^^<http://www.w3.org/2001/XMLSchema#string>
<http://fortune.com/2014/07/29/mcdonalds-worker-rights-wages-nlrb/>