Jimmy John’s Agrees to Abolish No Poaching Agreement with Franchisees

Antitrust violation allegations have been launched against several major fast food restaurant companies, each of which allegedly signed a no poaching agreement with their franchisees.

The no poaching agreement essentially stated that the companies’ franchisees would not try to entice each other’s employees with better job offers or benefits like increased wages, which reduced the opportunities for better employment positions for their workers.

No poaching agreement clauses between restaurants and their franchises prevent their employees from getting increased benefits from their jobs, because the companies are not forced to keep up with a competitive work industry.

Overview of No Poaching Agreement Abolishment

This investigation has already spurred action from fast food employees, including one resident from Seattle alleging Jimmy John’s no poaching agreement between its franchises had prevented her from finding a better job.

According to Seattle station KIRO7, Merlee Sherman had worked as a courier for Jimmy John, and was hoping to eventually move up the employment ladder. However, she believes the no poaching agreement between the franchises forced her to stay in the same position. Her story eventually reached Washington Attorney General Bob Ferguson, which resulted in Sherman telling her story at a news conference in July.

“There is not mobility for me to receive better pay at another Jimmy John’s,” Sherman said at the press conference.

It is important to note that this press conference came shortly before Jimmy John’s announced that it was dropping their no poaching agreement. The company announced the change after receiving intense pressure from Ferguson’s office.

According to Ferguson, the total number of restaurants that have agreed to drop their no poaching agreements has risen to 23, which now includes Jimmy John’s. Other restaurants that have agreed to cooperate with the attorney general’s efforts include A&W, Burger King, Denny’s, Papa Johns, Pizza Hut, Popeye’s, Tim Hortons, and Wing Stop.

Each of these restaurants reportedly agreed to not only eliminate their no poaching agreements in Washington but throughout the United States.

Working to Help Franchise Employees

Attorney General Ferguson is now purportedly taking aim at restaurants that reportedly still use a no poaching agreement, including Baskin Robbins, Domino’s, Quiznos, Firehouse Subs, and Jersey Mike’s.

Each of the companies had reached out with their own statements, with Baskin Robbins stating that it is currently discussing different solutions with the Attorney General’s office and hopes to soon come to an agreement. Jersey Mike’s general council stated that the company had abolished its no poaching agreement in February 2018, with a company representative stating that the company did not want to participate in a “publicity stunt.” Similarly, Domino’s had reached out with a statement to KIRO 7 that had stated they released franchises from their no poaching agreement clause on a nationwide level.

With the success of this investigation, the attorney general is currently looking into other no poaching agreement clauses in other industries.

“We’ve already started investigations in multiple other areas. Hotels, for example; we’ve started our investigations there and we’re going to continue in other areas, gyms, you name it,” Ferguson said.

Ferguson stated that he wants companies to sign legally binding documents that force out the no poaching agreement clauses, which will help workers throughout the United States.

Join a Free Fast Food Employee Poaching Class Action Lawsuit Investigation

If you work for McDonald’s, Jimmy John’s, Pizza Hut, Little Caesars, Papa John’s, Domino’s, Burger King or Arby’s and were prevented from moving to a different franchise that is part of the same company, you may have been the victim of a no-poach agreement. If so, you may qualify to participate in this employee poaching class action lawsuit investigation.

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