McDonald’s No Poaching Agreement Allegedly Just One of Many in Fast Food Industry

If you work for McDonald’s and have had a difficult time getting a job at a different franchise of that same company, you may have been a victim of a McDonald’s no poaching agreement.

Many fast food restaurants allegedly have signed no poaching agreements with fellow franchisees from the same company. These agreements mean that one McDonald’s franchisee promises not to hire anyone from another franchisee.

Employees do not sign anything that refers to the McDonald’s no poaching agreement–in fact, they may never know the agreement exists, because the agreement is between franchises or between the franchise and corporate headquarters, not between McDonald’s and the employee.

After facing lawsuits alleging that the McDonald’s no poaching agreement violated labor laws and antitrust laws, McDonald’s removed the verbiage from its contracts. CKE Restaurants Holdings, which is the parent company of both McDonald’s and Carl’s Jr., has not commented on whether their decision was linked to the lawsuits.

The company recently agreed to an assurance of discontinuance with Washington Attorney General Bob Ferguson, promising not to enforce no poaching clauses in prior agreements.

McDonald’s No Poaching Agreement

In addition to McDonald’s, nearly 40 other restaurant chains allegedly have used similar non-compete clauses among their franchises. Franchise managers insist these clauses are necessary because if one restaurant location trains an employee who soon takes a job at another franchise, the location that put in the time, money and effort to train the person has nothing to show for their investment.

Employees argue that clauses such as the McDonald’s no poaching agreement prevent employees from securing better jobs, increased wages, improved benefits and career growth.

One woman’s lawsuit contends she worked at a McDonald’s location in Florida from 2009 to 2016, hoping for a promotion that never came. Plaintiff Leinani D. worked as a manager and thought she might one day run her own franchise.

Leinani said she was promoted to department manager and believed she was on track to attend the company’s management training program in Illinois. She claims in her lawsuit that her training was canceled when she became pregnant, and she was never considered for the promotion again.

Determined to keep her career on track, Leinani says she tried to obtain a position at a different McDonald’s but alleges the McDonald’s no poaching agreement kept her from being offered a position.

U.S. District Judge Jorge L. Alonso allowed Leinani’s class action lawsuit to go forward, saying in part that “[e]ven a person with a rudimentary understanding of economics would understand that if competitors agree not to hire each other’s employees, wages for employees will stagnate. Plaintiff herself experienced the stagnation of her wages.”

Other fast food restaurants that might be implementing similar no poaching agreements include Arby’s, Burger King, Domino’s, Jimmy John’s, Little Caesars, Papa John’s, and Pizza Hut.

In April, the Antitrust Division of the Justice Department began an investigation into whether or not such no-hire agreements violate the law. The Justice Department released a statement that said employees are entitled to the opportunities that a competitive job market brings, just as consumers enjoy the benefits of competitive markets.

If you work for a fast food restaurant and were unable to secure a job at another franchise of the same company, you could be eligible to participate in this investigation.

Join a Free Fast Food Employee Poaching Class Action Lawsuit Investigation

If you work for Arby’s, Burger King, Jimmy John’s, Papa John’s, Pizza Hut or Domino’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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