Lisa Madigan, Along with 10 Other Attorneys General, Launch Investigation into ‘No Poach’ Agreements at National Fast Food Franchises

Fast Food
(Source: 123RF.com)
Chicago —(ENEWSPF)—July 9, 2018
By: Rosemary Piser

Attorney General Lisa Madigan announced today that she has joined 10 other Attorneys General, sending a letter to eight national fast food franchisors about so-called “no-poach” or “no-hire” agreements in franchise contracts. The Attorneys General said in their letter that no-poach provisions make it difficult for workers to improve their wages by moving from one job to another or seeking a higher-paying job at another franchise location and that many workers are unaware they are subject to no-poach provisions.

Attorney General Madigan said, “No-poach agreements trap workers in low-wage jobs and limit their ability to seek promotion into higher-paying positions within the same chain of restaurants. I am investigating this practice because it unfairly stops low-income workers from advancing and depresses their wages.”

According to the letter, 58 percent of major franchisors have no-poach provisions in their franchise agreements, and the number is even higher, at 80 percent, for fast food franchisors. Advocates for workers argue that these provisions have led to persistent low-wage growth and are anticompetitive in nature.

The letter was sent today to:

  • Arby’s,
  • Burger King,
  • Dunkin’ Donuts,
  • Five Guys Burgers and Fries,
  • Little Caesars,
  • Panera Bread,
  • Popeyes,
  • Louisiana Kitchen, and
  • Wendy’s.

The Attorneys General ask that these restaurants provide documents, including copies of franchise agreements and communications related to no-poach provisions, by August 6, 2018.

Madigan also urged anyone in Illinois who believes they may have been impacted by these practices to contact her Workplace Rights Bureau at 1.844.740.5076.

Joining Madigan is sending today’s letter were the Attorneys General of California, District of Columbia, Massachusetts, Maryland, Minnesota, New Jersey, New York, Oregon, Pennsylvania and Rhode Island.

Source: www.illinoisattorneygeneral.gov

 

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