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Why Aren’t Paychecks Growing? A Burger-Joint Clause Offers a Clue

Discussion in 'Article Discussion' started by Melody Bot, Sep 28, 2017.

  1. Melody Bot

    Your friendly little forum bot. Staff Member

    This article has been imported from chorus.fm for discussion. All of the forum rules still apply.

    Rachel Abrams, writing for The New York Times:


    Some of fast-food’s biggest names, including Burger King, Carl’s Jr., Pizza Hut and, until recently, McDonald’s, prohibited franchisees from hiring workers away from one another, preventing, for example, one Pizza Hut from hiring employees from another.

    The restrictions do not appear in a contract that employees sign, or even see. They are typically included in a paragraph buried in lengthy contracts that owners of fast-food outlets sign with corporate headquarters.

    Yet the provisions can keep employees tied to one spot, unable to switch jobs or negotiate higher pay. A lack of worker mobility has long been viewed as contributing to wage stagnation because switching jobs is one of the most reliable ways to get a raise.

    How is this legal?

     
  2. tyramail

    Trusted Supporter

    I had a friend who worked for Pizza Hut and it was far and away one of the most horrible companies she’d worked for. They made her work 10+ hours with no overtime pay, never gave raises, and did not allow employees to take any breaks. Not sure how they get away with these things.
     
    Essie likes this.
  3. Piercalicious

    Regular Supporter

    Well, non-competes are generally okay in a lot of states and when it comes down to it the antitrust argument is kinda flimsy. These are prohibitions on intra-franchise hiring, so the argument has to prop itself up on the idea that the franchises of each company are effectively individual "markets" where individual franchisees are competing amongst themselves - which is a bit of a stretch. It's not like it's prohibiting a McDonald's worker from trying to get a job at literally any other burger joint, there's still very much a market for them to find employment in.

    Do agree that it's a shitty and probably unnecessary rule though, just think the legal footing these plaintiffs are standing on isn't very good.
     
    coleslawed likes this.
  4. Fletchaaa

    Regular Supporter

    I wonder how often it's enforced, at my job there are at least a few people who signed non competes and are clearly competing anyway lol
     
    Loki likes this.
  5. Loki

    God of mischief

    While I am not outright condoning it, I encourage everyone to read every single part of a contract offer.

    Source: Almost a decade down in "Big Corporate" America
     
  6. Piercalicious

    Regular Supporter

    Well, to get a non-compete enforced you've gotta seek relief in court, and in a lot of instances the cost of that litigation is probably higher than whatever damage the employee is doing to their former employer by working with a competitor.
     
  7. Meh, not really ...
     
  8. Piercalicious

    Regular Supporter

    Literally the majority of state judicial systems enforce non-competes, a few have even endorsed that position through legislation.
     
  9. They are very hard to enforce. Most are written way too broadly and get axed.
     
  10. Sean Murphy

    this is me now Supporter

    the company i currently work for was just bought out by a competitor this past spring/summer and as a part of the new employee agreements everyone had to sign non-competes, and, slowly but surely every few weeks someone else is leaving to go across town to work for a direct competitor, and to my knowledge none of them has heard word 1 about going to work for the competitor, though they signed the non compete. non competes are in place i think to prevent people from stealing clients or taking leads, but even then it's probably very hard to actually enforce.
     
  11. Piercalicious

    Regular Supporter

    It's incredibly state dependent. You're right that when they do fall apart it's because they're too broad (that's essentially the crux of the judicial analysis), but I don't know if I would go so far as to say "most" are unenforceable. When I was researching the issue in Michigan, for example, the holding in the published opinions on the issue slightly statistically favored the employer; other states in the 6th circuit tended to come out slightly the other way.
     
  12. My attorney, who got the shitty one I signed out of college tossed, told me he's never in 50 years seen one actually enforced. He's gotten literally every single person he's worked with out of it.
     
    AshlandATeam likes this.
  13. Piercalicious

    Regular Supporter

    I mean that's great for your attorney, but it really doesn't take that long of a Westlaw search to find a shitload of cases where they were enforced.
     
  14. Which is why I said rarely and not "never." Compared to how many people have them, and how many are ever actually enforced, I think "rarely" fits perfectly with what we see.

    (If you have one, fight it. And while you're at it push your states to make them illegal.)
     
    fredwordsmith likes this.
  15. Piercalicious

    Regular Supporter

    You actually never said rarely (>-p, I tease), but I understand what you mean and I do agree that they're basically always worth fighting if someone seeks to enforce it against you (mostly because when it's alleged you're in breach, attempting to comply with the clause generally would result in you giving up your employment, so you don't really have a choice).

    I think there's a distinction between what we both mean when we say "enforced" here - most of the time it's not "enforced" because the party seeking enforcement gives up or settles before they even get to the point of litigating the validity of the clause in court due to the costs of doing so. What I was speaking to was how often courts, when the issue has been litigated, choose to "enforce" the clause by entering an injunction. Those numbers are, as I wrote, incredibly state dependent, much closer to 50-50 in some jurisdictions, and I don't think it's actually a safe bet to tell people that are potentially subject to them that they're most likely to not get enforced if it actually goes to court. But that doesn't mean that what you say is not also true - that amongst all noncompetes in existence, the majority of them will not be enforced - we're just saying different things when we say "enforced".
     
  16. AshlandATeam

    Regular

    A non-compete at a burger joint sounds hilarious. And ludicrous on its face.

    The only non-compete I've ever been familiar with has been the tattoo shop I'm friends with everyon at makes their artists sign an agreement that if they end up branching out on their own, they can't open up a competing shop within a certain mile radius. That's the only circumstance I've ever heard it in. It's very odd to me to know they exist in places that aren't so specialized/connected.
     
  17. jpmalone4

    Stay Lucky Supporter

    Non-competes are bullshit and should be illegal. Period.
     
    Raku likes this.
  18. Fletchaaa

    Regular Supporter

    I mean I sort of get it sometimes. The company I work for had previous owners that sold and worked at the company for a little bit but then left and took a lot of people with them to start the same business. They also took some of the customers and business away that they had relationships with. They are now being sued for a non compete
     
    Fucking Dustin likes this.
  19. Stilicho

    Newbie Supporter

    That seems like a one of the few good place for a non compete. If the old owners of the company really did cannibalized the most valuable aspects of old company after selling to start a new version of the same business, taking employees and customers, that seems like borderline dealing in bad faith. I suppose the board line aspect would have made a non compete a powerful tool to ensure the new sellers didn't get away with essentially fraud.

    Pretty much any non compete used against an individual employee seems like a tool to hobble employees however. In the above burger chain situations it makes the employees skills non-transferable removing huge advantages they would otherwise have to ask for promotions or raises at similar places that could use those skills. Even when people know about non compete clauses in their contracts, even if they are not ultimately enforceable, the threat of repercussions for leaving a work place will like prevent someone from actually leaving the company.

    In short, I agree there is are good reasons to use non-compete agreements, but I also think they're probably generally not used for those reasons.
     
    Fletchaaa and Raku like this.
  20. Fucking Dustin

    Chorus.fm Pokemon Draft League Reigning Champion Prestigious

    Yeah non-compete isn't bad in general for some reasons specified already in this thread but the last place I feel like it should be used is fucking fast food
     
    Raku and Fletchaaa like this.