McDonald’s Franchisees Cry Over Minuscule Wage Hike That Doesn’t Even Apply To Them

McDonald’s franchise owners are having a big sad this week over the fact that the chain raised wages 72 cents an hour at all corporate-owned locations. Although the franchise owners are not required to give employees the raise, they are upset because they now “feel pressured” to do so.

Via Business Insider:

Franchisees say the decision — which affects just 10% of McDonald’s US employees — was an “embarrassing” marketing stunt that has backfired against them, according to a survey by Janney Capital Markets.

“McDonald’s has stabbed us in the gut,” one franchisee wrote in response to the survey. “My ‘partner’ has only itself in mind it has declared war on the operator.”

“Relations between McDonald’s Corporation and the operators are the worst I have ever seen,” one franchisee wrote. “Operators feel betrayed. We have been struggling with profitability for the last year. We thought our partner understood this.”

“Stabbed us in the gut?” really? Over 72 cents? Which would amount to, at the very most, a $1500 raise for an employee working full time at minimum wage? How hard, I wonder, would these franchisees laugh if their employer offered them a $1500 raise?

The franchise owners say this is just another way McDonald’s is screwing them. Apparently, they also have to pay for kitchen upgrades for a new menu, which will cost $125,000 and $160,000. Which, just saying, would actually be two to three times more than paying their employees 72 cents more an hour.

Before you even consider shedding too many tears for these “operators,” allow me to note that in order to even own a franchise, you need to be a millionaire to begin with. In order to even be considered by McDonald’s franchise development department, you need to have, at minimum, $750,000 of non-borrowed cash ready to hand over. Then, it’s not like you’re in there making the burgers or managing the restaurant, you just pretty much sit back and let the profits roll in. It’s an investment, not a job.

It’s a pretty good investment too. The average McDonald’s store rakes in $2.6 million dollars a year in sales. Sure, there are overhead costs, as you have to pay a percentage of your store sales towards rent, which on average comes out to about $250,000 a year.

The average McDonald’s has about 40-60 crew members, nearly all of whom are part time, who are most likely the ones getting the minimum wage.

Here are some things to consider!

The national minimum wage is $7.25 an hour. To pay a minimum wage employee full-time would cost $15, 080 a year. In contrast, a living wage for one person, where I live in Chicago is supposedly $10.48 an hour–or $21,798 a year working full-time. In order to pull that much–in order to just basically survive and maybe not need to be on any government assistance? Even with our higher than the national average minimum wage of $8.25 hours, one would have to work 50 hours a week to make that much, for just one person with no dependents. Then, throw in the fact that it is really difficult to manage two minimum wage jobs, as scheduling in this industry is notoriously erratic.

Of course, most minimum wage employees are not full-time, as employers would often prefer to not pay for insurance, which they now have to do for employees working an average of over 30 hours a week. So, more likely, they have a lot of people working at 29 hours a week–which would work out to $10,933 per employee.

Naturally, there are ways to get around this. McDonald’s was the subject of a major class action lawsuit over wage theft last year, and one of the complaints was that employees were made to clock out and continue working so that they didn’t have to be paid regular wages, or overtime, or given insurance.

So, say you have 50 employees working 29 hours a week at the national minimum wage of $7.25. The cost to you as a franchise owner would be $546,650. A 10% increase in wages–which by the way would only be 72 cents an hour–would cost you a whopping $54,665 a year.

You, the guy who does pretty much nothing? You are still raking in about $1,748,685. Even when you add in the “upgrades” they’re all upset about? It’s still around $1.6 million. For doing exactly zero hours work. Quite frankly, these “operators” are entirely unnecessary from a functional standpoint. All they do is offer “capital” and then sit back and profit from other people’s labor. Not to get all “the workers must own the means of production” about things, but I’m pretty sure that a McDonald’s could function perfectly fine on its own without a franchisee.

So yeah, no. I do not feel badly for these embattled franchisees, especially since this increase doesn’t even apply to them. I am too busy feeling badly for the people desperately trying to make ends meet. If the franchise owners were smart, they’d increase wages themselves instead of waiting to have their hand forced.

Because you know what? There are protests all around the country today advocating for a $15 minimum wage, and they are not going to stop until we start making this a country where every person who is able to work can work 40 hours a week and feed, clothe and house themselves. These days are numbered. People in this country are sick and tired of kowtowing to the needs of the whiny profiteer class who worry only about how much money they will get to make off of other people’s labor.

So get with the program. If you can’t pay your employees a fair wage, then you don’t deserve to profit off of their labor. You are not owed cheap labor any more than you are owed the ability to own slaves. And yes, we will continue to pressure you and embarrass you until this gets fixed.