Violations of Wage Laws

A three-judge panel for the Ninth Circuit Court of Appeals recently considered whether McDonald’s should be held liable for violations of wage laws. McDonald’s workers argued that McDonald’s-corporate should be held responsible for overtime violations because it required franchisees to install in-store process systems that miscalculated workers’ wages resulting in violations of wage laws. This case represents just one of the many in which overtime violations can occur in a modern context.

How the Wage Lawsuit Began

The lawsuit was initiated in 2014 by a group of cashiers against a McDonald’s franchise owner on the basis that the franchise owner denied workers meal and rest breaks and failed to pay all overtime hours worked because the McDonald’s computer system erased overtime from their timecards – causing off-the-clock work resulting in unpaid overtime.

Later, in 2017, the workers settled with the Haynes family for $235,000. A federal judge, however, later sided with McDonald’s by issuing a ruling that the McDonald’s company cannot be held liable for workplace violations because under California’s labor code, the company does not constitute an employer.

Ruling on McDonald’s summary judgment, a United States District Judge observed that the franchise owner was responsible for hiring, terminating, and disciplining workers as well as establishing working conditions. The Ninth Circuit, however, is considering whether McDonald’s should be deemed liable for this overtime violation.

Time Tracking Software 

The recent hearing of this case involved evidence about whether use of McDonald’s software that performed the overtime violation was made mandatory because it was so heavily incentivized. Franchisees are reported to have been told that while they were not required to use the software, it was much more affordable than using their own computer systems. This led to a debate about whether financial incentives constitute being required to do something.

Additionally, McDonald’s franchise agreements require franchise owners to strictly adhere to McDonald’s established methods used to create audit reports. On one hand, if the software was merely incentivized, employers were not required to use it. Legal representation has commented that while franchise owners had an economic incentive to use the software, this do not constitute franchise being required to use the program.

If employers were required to use the software at the risk of being viewed by McDonald’s as underperforming, the McDonald’s company might have some liability in the violation of these overtime laws. As a result, judges took the case under submission and it still remains uncertain exactly what ruling will be made and what influence the case will have on other fast food workers.

Speak with an Experienced Wage and Hour Lawyer

The larger the company, the more incentive there is to short employees’ hours and force employees to perform off the clock work – resulting in huge savings to the company.  

If you believe that you were not adequately compensated for overtime work by your employer, you should not hesitate to speak with an experienced attorney. At Herrmann Law, we have helped numerous workers create strong strategies in overtime cases and understand what it takes to make sure that you receive adequate compensation. Contact an overtime attorney at Herrmann Law today to schedule an initial case evaluation, during which time we will discuss your various available options to pursue legal action against your employer. Call our office: 817-479-9229 or fill out our online questionnaire, and someone from our office will contact you.