US: Fast food franchises end anti-poaching contracts

Seven fast-food chains agreed Thursday, July 19, to grant their employees greater mobility by removing language from contracts that prevented them from taking jobs at other franchise locations with higher wages.

The announcement came in lieu of the companies facing a lawsuit from Washington State Attorney General Bob Ferguson, who encouraged McDonald’s, Cinnabon, Jimmy John’s, Carl’s Jr., Arby’s, Auntie Anne’s, and Buffalo Wild Wings, to remove the no poaching clauses—which can lead to stagnant wages—in the franchises’ agreements. Employers at one of the state’s over 50 Arby’s locations, for instance, will now have the freedom to hire a worker from another restaurant of the same chain.

“Companies must compete for workers just like they compete for customers,” Ferguson said in a statement. “They cannot manipulate the market to keep wages low.”

The seven fast-food chains agreed to stop this practice not only at their over 500 Washington State locations, but nationally. Tens of thousands of low-wage employees will be affected across the United States at more than 25,000 locations.

Full Content: The New York Times

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