On Wednesday, we got a look at a leaked WalMart training video [9] in which a series of “associates” (read: hilariously bad actors) patiently explain to new hires why unions are bad.
The video is especially relevant in light of the retailer’s recent battle with intractable “clogs and leaks” at several locations and if “clogs and leaks” actually means “unions” then it makes a lot of sense why the company closed its Pico Rivera location because if ever there were a WalMart store that suffered from stubborn “plumbing problems” then Pico Rivera is surely it.
But WalMart isn’t the only giant multinational that just can’t seem to get the “plumbing” fixed because as you’ll see below, legions of McDonald’s workers descended on the company's Illinois headquarters ahead of the annual shareholders meeting in an effort to show the company that they are most assuredly not “Lovin’ It.”
Here’s The Chicago Tribune [10]:
Potesters hailing from as far away as Kansas City and New York City participated in a demonstration at McDonald's Oak Brook headquarters Wednesday, urging that hourly wages for the burger giant's front-line workers be increased to $15 an hour.
Darrell Miller, 35, who said he left Kansas City, Mo., Tuesday night on a bus filled with other protesters, said he decided to join in because it was his dream to march like the Rev. Martin Luther King Jr. and fight for freedom.
His job at McDonald's, he said, gives him no control over his life or his independence because the $7.75 an hour he is paid barely covers his bills.
Protesters, who had gathered about a half a mile west of the headquarters, slowly marched toward McDonald's campus shortly after noon. At the head of the long line of protesters several held aloft a banner: "McDonald's $15 and union rights, not food stamps. #fightfor15."
The Oak Brook police estimated the crowd at about 2,000 people. Organizers had projected that upward of 5,000 would participate in the demonstration.
Before demonstrations began, Heidi Barker, a McDonald's spokeswoman, said the company does not have the power to raise wages of workers employed by its franchisees. She said it's possible that franchisees will follow the company's lead and also raise wages of front-line workers.
McDonald's will increase starting wages to $1 above the local minimum at 1,500 company-owned restaurants effective July 1. While that increase affects more than 90,000 employees, those restaurants account for about one-tenth of McDonald's restaurants across the country. Franchisees, which operate the majority of U.S. restaurants, make their own decisions on pay and benefits. Overall, about 750,000 employees work at company- and franchisee-owned McDonald's restaurants in the U.S.
Given that McDonald's can play the "it's up to the franchise owners" card when it comes to wages, one approach to dealing with rising wages if you're the company is simply to decrease the number of company-owned locations, which is why we aren't surprised to learn that the company is refranchising thousands of stores:
- MCDONALD'S WILL REFRANCHISE 3,500 STORES GLOBALLY BY 2018
- MCDONALD'S SAYS MOVING TO 90% FROM 81% FRANCHISED GLOBALLY
And while the company's employees may not be getting rich, its shareholders sure are, and it's all courtesy of central banks. McDonald's completed its largest reverse Yankee bond sale in history this week, raising $2 billion, money which, as you can see below, will be promptly used to buy back stock, enriching shareholders and management even as workers strike for higher wages. In other words: not only is the QE 'wealth effect' not working, the exact opposite is happening. Central bank policy is serving, once again, to exacerbate the wealth divide:
- MCDONALD'S SEES RETURNING $8B-$9B TO SHAREHOLDERS THIS YR
Of course Illinois’ fiscal nightmare [11] isn’t helping matters for workers in the state, as budget cuts aimed at closing a $6 billion funding gap are driving up prices for services:
Adriana Alvarez said that since joining the Fight for $15 campaign last year, her hourly wages at a McDonald's on Cicero Avenue jumped by $1.75 an hour, reaching $10.50 an hour. But the single mother of a 3-year-old boy said her costs also continue to go up and state budget cuts affected a child care subsidy she receives.
And according to union officials, the battle for higher burger flipping wages is just getting started:
Mary Kay Henry, president of the Service Employees International Union, called on McDonald's to sit with a union at a national bargaining table and put some of its profits into the pockets of workers.
"Even when we get $15 and a union we will keep fighting," Henry said.
[12]
[13]
We suspect it might be just a matter of time before McDonald's and some McDonald's franchisees decide that now might be a good time to fix the plumbing at certain locations.
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A reminder to McDonald's: WalMart suggests you discourage this kind of thing early on by showing this to new hires...
