McDonald's Corp. has agreed to pay $3.75 million to settle wage-and-hour claims brought against the company and its franchisees by a class of about 800 restaurant workers at franchisee-owned establishments in California.
The settlement, which still needs approval from the U.S. District Court for the Northern District of California, comes amid growing attempts to hold McDonald's liable for alleged labor violations of its franchisees as a "joint employer." The agreement puts the fast-food giant on the hook for damages, plus attorney fees and cash for a California labor enforcement agency to pursue more cases. McDonald's has also agreed to injunctive relief, including creating new wage-and-hour training materials.
Although the Ochoa case may be almost over, McDonald's still faces joint employer liability on another front: the National Labor Relations Board. Using a new joint employer standard developed in a 2015 case that requires only "indirect control" of one company over another to create joint liability, the NLRB is in the middle of deciding whether McDonald's can be held liable for allegedly retaliatory actions that franchisees may have taken against striking restaurant workers.
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