McDonald’s Class Action Says No-Poaching Policy Restrains Job Opportunities

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A former McDonald’s employee is challenging the company’s policy that forbids one franchisee from “poaching” employees from another.

Plaintiff Leinani Deslandes says this no-poaching policy serves defendant McDonald’s and its franchisees at the expense of their employees, who are unfairly prevented from seeking better employment opportunities within the same restaurant chain. She argues this policy is an anti-competitive practice that puts defendant McDonald’s in violation of federal and state antitrust laws.

According to this McDonald’s antitrust class action lawsuit, the agreements between McDonald’s and its franchisees contain certain “no hire” and “no solicitation” provisions. These provisions prevent franchisees from employing or seeking to employ a person who within the previous six months worked for McDonald’s, a McDonald’s subsidiary, or another franchisee.

Such no-poaching agreements are an “unreasonable restraint of trade,” Deslandes says. She quotes Wharton business professor Joseph Harrington, who says that “companies agreeing not to compete for each other’s employees is the same as companies agreeing not to compete for each other’s customers.”

Deslandes explains that these agreements shrink each employee’s value as an employee, restricting their mobility in the job marketplace. This effect is particularly acute for McDonald’s employees, who she says have skills that are valuable only within the McDonald’s chain and do not transfer well to other fast-food employment.

Deslandes says that while she was working as a manager for one McDonald’s franchisee, she applied for another managerial position with a different franchisee. The newer position would have offered her a significantly higher hourly wage and more opportunities for advancement, she says.

But in accordance with the McDonald’s franchisee agreement, the new franchisee refused to hire Deslandes unless her current employer consented to the job change.

Deslandes says her current employer refused to consent to the change. She claims she was effectively stuck working for her current employer – who she also alleges required her to work overtime hours without paying a higher overtime wage, and who she accuses of discriminating against her while and because she was pregnant.

She eventually quit working for McDonald’s and took a job in retail, accepting a significant drop in wages.

Deslandes is proposing to bring this McDonald’s class action lawsuit on behalf of a nationwide plaintiff Class consisting of all U.S. persons who are current or former employees or managers of McDonald’s restaurants. The Class would include workers from both company-owned and franchisee-owned restaurants.

She is asking the court to permanently enjoin McDonalds from continuing to follow its no-poaching policy and from holding its franchisees to a similar agreement in the future. She also seeks an award of damages, restitution, court costs and attorneys’ fees, all with pre- and post-judgment interest.

Deslandes’ attorneys are Derek Y. Brandt of Brandt Law LLC, Richard D. McCune, Michele M. Vercoski and Emily J. Kirk of McCune Wright Arevalo LLP, and Jason K. Whittemore of Wagner McLaughlin PA.

The McDonalds’ Employee Antitrust Class Action Lawsuit is Leinani Deslandes v. McDonald’s USA LLC and McDonald’s Corp., Case No. 1:17-cv-04857, in the U.S. District Court for the Northern District of Illinois.