McDonald's Announces Raises For Some Employees

After months of fast-food workers staging numerous protests across the country, including walking off the job entirely, on Wednesday the CEO of McDonald's said it will raise pay for workers at some of it restaurants, The New York Times reported. The raises fall short of the $15 per hour that angry workers have been calling for, with the average new pay rate going up to about $9.90 by July 1, and to more than $10 an hour by 2016. McDonald's will also begin offering paid time off for employees who have been with the company for at least a year, even some part-time workers, and a paid program to help workers obtain high school equivalency diplomas.

But while a pay increase and new benefits ares good news for some of the people who work for the fast food giant, there's a hitch, according to The Times. The raises are only effective for the 90,000 workers at restaurants that are owned by McDonald's itself, not at the franchises. And the more than 3,100 McDonald's franchisees that operate approximately 12,500 restaurants, which employ about 750,000 workers, who will not automatically receive these raises. So, there's the potential that two McDonald's workers could be doing the same job, but if one works at a franchisee-owned restaurant, he or she will earn less than the worker at a company-owned store.

Not everyone was impressed with McDonald's announcement, with one worker asking if it was an April Fools' Day joke, The Times reported. The National Employment Law Project told The Times that even for employees who receive the higher pay, most will still be near the poverty line.

So, what does this mean for the franchisee owners? An investment analyst told The Times the increase by the company might put pressure on them to raise wages as well, even though McDonald's technically can't tell them to do so.

In an interview with The Wall Street Journal, McDonald's CEO Steve Easterbrook said the changes would improve customer service, since "motivated teams deliver better customer service, and delivering better customer service in our restaurants is clearly going to be a vital part of our turnaround.”

But, as The New York Times noted, Easterbrook's predecessor as McDonald's CEO made $13.8 million in 2012, and the company had profit last year of $5 billion, so it doesn't seem unreasonable to expect a little more of that profit to benefit the workers who are working the grills and the drive-thru windows. It's possible the move will pressure other restaurant chains to increase workers' pay, but given the size of its workforce and the amount of resources it has available, it's safe to say that McDonald's can afford it.

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