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McDonald's franchise settles business litigation

The McDonald's franchise may be one of the most recognizable chains of fast-food restaurants worldwide. The "Golden Arches" are a ubiquitous feature in many Florida cities, serving as an oasis on interstate exits or as the local town meeting place for a burger or cup of coffee. However, the company is no stranger to business litigation.

Recently, McDonald's settled a lawsuit brought by the National Labor Relations Board. The NLRB argued that McDonald's should be considered a joint employer and therefore should be held legally responsible if one of its franchises committed unfair labor practices. In 2014 workers at a number of McDonald's restaurants in New York City alleged they lost their jobs when they protested against their low take-home pay and bad working conditions. In 2016 a lawsuit commenced, wherein people testified to the trial court for hundreds of hours. In the lawsuit, the NLRB claimed that since McDonald's, as a parent company, had so much control over how its franchises were operated, it was mandatory for McDonald's to share legal responsibility for unfair labor practices carried out by its franchisees. The NLRB buttressed it's claims citing McDonald's detailed rules and procedures when it came to hiring workers and paying workers.

The NLRB requested that a time-out be granted so that it could attempt to settle the matter. A settlement was reached. The parties are now waiting for the judge to approve the settlement. The terms of the settlement have not yet been released to the public.

As this shows, even business litigation involving industry giants can end up in a settlement rather than a judicial ruling. Not every case makes it all the way through the trial process. Sometimes, it is in the parties' best interests to settle, even if the business litigation process has already commenced. A settlement can leave both parties feeling satisfied with the outcome of the case, rather than having a "winner" and a "loser." Still, if a case simply cannot be settled and the case must go through the trial process, it can help to ensure that the businesses involved have the legal assistance they need to argue their side of the story so that a fair and appropriate decision can be made.

Source: Business Management Daily, "McDonald's, EEOC to settle major joint employer lawsuit," March 22, 2018

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