McDonald's faces $250 million lawsuit over wage theft claims

Fast-food chain under fire for alleged denial of paid breaks to workers

McDonald's faces $250 million lawsuit over wage theft claims

Fast-food giant and global icon McDonald’s is currently facing a wage theft claim of over $250 million following its alleged denial of paid breaks to workers.

The Shop, Distributive, and Allied Employees’ Association (SDA) led the legal fight against the company and is now seeking compensation for over 250,000 current and former McDonald’s workers in Australia, ABC News reported.

However, despite the SDA’s claims,  the report said McDonald’s Australia issued a statement denying the allegations and emphasising that the corporation’s conduct is in line with the law.

Alleged denial of workers’ rights

The SDA alleged that McDonald’s denied workers in more than 1,000 current and former sites an uninterrupted 10-minute break when working four hours or more during a shift, ABC News reported.

South Australia branch secretary, Josh Peak, told ABC Radio Adelaide Breakfast that the workers of the multi-billion-dollar corporation were instructed that if they wanted to receive their paid break, they could not get a drink or go to the toilet.

“Workers were systematically, deliberately denied the rights to those breaks,” Peak said. “It’s just not good enough that a large employer such as McDonalds would create a scheme that leads to people not being paid correctly or getting base entitlements,” he added.

According to ABC News, in almost two years of investigation, Peak said the union had already heard over 10,000 accounts from former and current McDonald’s employees, including young Australians.

Based on the statement of claim, it was suspected that workers had to ask for permission to get a drink or go to the toilet and could be instructed to resume work even before their 10-minute break was up, the news outlet reported.

Moreover, Peak said that the workers were uninformed or misled about their work entitlements. Hence, the giant fast-food chain must be penalized for it.

“It is really outrageous behaviour to be tricking young people into thinking they are not entitled to go the toilet if they utilised their paid entitlements,” Peak said.

ABC News said the claim named 323 McDonald’s operators who allegedly denied workers their paid rest breaks over the past six years.

Meanwhile, McDonald’s denied the allegations and said it complied with all applicable instruments, including providing rest breaks to its employees.

“We are very mindful of our obligations under applicable employment laws, including the former enterprise agreement and the Fast Food Industry Award, and continue to work closely with our restaurants to ensure employees receive all correct workplace entitlements and pay,” a McDonald’s spokeswoman said, according to ABC News.

Claim began from South Australia

The most recent claim is “in conjunction with the SDA’s 15 existing Federal Court claims against McDonald’s Australia and 14 franchisees — seven of them in South Australia.”

In December 2020, the news outlet said that 14 McDonald’s workers at the Frewville and Mount Barker branches made an official complaint after being allegedly denied their 10-minute break. Hence, the investigation extended nationwide.

Isabelle, a former employee at McDonald’s Adelaide CBD for almost five years, said she was unentitled for a 10-minute break and instead allowed to have drink breaks freely during shifts, ABC News reported.

“The drink break was only for 20 seconds, or as fast as you could drink and then come back to work straight away,” Isabelle told ABC News. “I’d spoken to my bosses about it, and they just told us that we didn’t get them, they chose to do something different, and that it was legal, it was all fine.”

Even when she was in a managerial position, Isabelle said she still felt scared of other managers at her former workplace, ABC News said.

“I remembered thinking, what do I need more? Do I need a drink more or do I need to go to the bathroom more — and then you just pick from there,” Isabelle said. “Now that we’re going into an actual, normal workplace, we know that that definitely wasn’t normal to be stressed about going to the bathroom or getting a drink.”

According to Peak, Isabella’s troubling experience was shared by other current and former McDonald’s workers across the country. 

He also said that the existing claims against McDonald’s should warn other franchises not to abuse workers’ entitlements.

“It’s also about sending a signal right throughout the entire fast food industry that young workers, just because they’re young, doesn’t mean you can lie to them,” Peak said.

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