McDonald’s Agrees to Pay $3.75 Million to Settle Wage-Theft Lawsuit

McDonald's Agrees to Pay $3.75 Million to Settle Wage-Theft Lawsuit

McDonald’s Corp has agreed to pay $3.75 million to settle a lawsuit claiming it was liable for labor law violations by a California franchisee, marking what lawyers said was the first time the company has settled legal claims by a group of U.S. workers at one of its franchises.

In a filing in U.S. district court in San Francisco on Friday, lawyers representing about 800 employees at five restaurants owned by a single franchisee said Illinois-based McDonald’s would pay the workers $1.75 million in back pay and damages and $2 million in legal fees.

The settlement, which must be approved by a federal judge, comes as McDonald’s faces claims before two U.S. agencies that it is a “joint employer” of workers at franchise restaurants, a designation that could make the company liable for legal violations by franchisees and require that it bargain with workers who unionize.

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