Maccas admits to cheating workers of holiday pay

By   /   February 10, 2017  /   7 Comments

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What is sad is just how hard it is sometimes to get these big, profitable multinationals to even obey the law!

Recently staff at McDonald’s have been told by their employer that the company has finally accepting that they have been incorrectly calculating annual leave when workers take it. The memo is in a circular from head office dated 16 December that is only available on the company’s internal communication system.

The law requires the company to pay annual leave in “weeks”. The leave should be calculated as the “higher of” your average pay for the year or your current weekly pay. It may be, for example,that you have shifted from working 10 hours a week to 30 hours a week. The week’s leave should be paid at 30 even if the average for the year is less. If a worker’s current weekly pay is difficult to calculate because their hours change from week to week – then the law says it should be the higher of the last four weeks pay or the average for the year.

This is specified in detail in the law.

The problem was that McDonald’s only calculated leave as hours and then allocated hours when workers took leave. They did not calculate “weeks”. And even when they did calculate a week’s leave they only gave the average and simply didn’t bother doing a “higher of” calculation.

Unite asked the company to initiate an audit process after we identified this error in the company’s method of calculation in February 2015! It has taken almost two years before they finally acknowledged they were wrong to their staff.

Our initial request for information was ignored. They then simply denied the obvious.

We eventually got a lawyer to threaten to taken the company to court. The company continued to deny wrongdoing in a letter to Unite in December 2015.

In early 2016 it became public knowledge that McDonald’s was only one of many companies to have made the same “error”. The issue then became a matter of public debate and discussion.

Unite felt compelled to write to the company again on March 9, 2016, seeking assurances that they would take action on the annual leave issue.

They responded March 17 by saying that they had appointed an external third party to review their systems. In exchange for this step, we agreed to hold off legal action in a good faith expectation that the results of the audit would be shared with us.

At the end of 2016, it was becoming clear to us that the company appeared to be reneging on its good faith obligations to share information with us. Again the company gave us an “assurance” that you any problems identified would be fixed.

However, our distrust of the company has been reignited. At the end of last year, we submitted a formal wage and time record request to Mcopco for a record of the annual leave payments for our members and how they were calculated.

The information we have received confirms for us that many workers have been cheated of their lawful entitlements.

We will be having further discussions with the company to ensure everyone gets what they deserve.

We understand that nearly every employer in the country that employed staff on irregular hours has failed to apply the law correctly. Possibly hundreds of millions of dollars are at stake.

Now the Ministry of Business Industry and Enterprise are demanding answers from companies that have been reported to them. McDonald’s are on their list. Between the two of us I believe McDonald’s have finally realised the game is up.
What is sad is just how hard it is sometimes to get these big, profitable multinationals to even obey the law!

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About the author

Mike Treen

National Director of Unite Union

7 Comments

  1. WILD KATIPO says:

    ” What is sad is just how hard it is sometimes to get these big, profitable multinationals to even obey the law! ”

    Indeed.

    And Unite has been doing a marvelous job in going after these types for a very long time. These sorts of piratical industry’s were enabled a long time back by the neo liberal devolution that occurred more than 30 years ago and legislated such laws as the Employment Contracts Act under the lobbying and auspices of bodies such as the Business Roundtable ( now calling themselves the ‘ New Zealand Institute ‘ ) .

    And even though it now bears the softer sounding name of the Employment Relations Act,… the damage was done.

    And that damage was first to de – tooth , then discourage unionism and its protective collective awards rates … and so now , … there are MANY company’s who have been emboldened to threaten dismissal if any employee joins a Union or reports such issues to a Union.

    Human greed and selfishness being what it is , … is the very reason why we need a Police force, a military , and , – Trade Unions.

    A prime example of the de unionized workforce is Pike River.

    What went on there with most of the workers on individual contracts is a text book case of worker exploitation , intimidation and worker abuse by management.

    And to a lesser extent – at least as far as physical harm goes – so is the situation you have outlined in your article.

    It is time the wages , conditions and entitlements under which the NZ worker has to earn their living is cleaned up . There is no way this will happen under a National govt that has always been hostile to Unions and workers , for it has been under their watch that these sorts of abuses have been allowed to occur with their approval – and with a deafening silence from them until they have been forced to admit it because of bad publicity .

    It is obvious that a govt that is hostile to workers then needs to have their hand forced if they will not do anything about a situation out of a sense of fair play.

    Theft is theft and comes in many shapes , forms , and fashions.

    What this company has been doing is nothing short of it.

  2. countryboy says:

    Cheating the vulnerable isn’t the only thing Mc Shitburgers does.

    McDonald’s claims $20m from Florence over piazza restaurant rebuff

    The fast-food chain is taking legal action over the ancient city’s refusal to allow it to open an outlet in the Piazza del Duomo

    https://www.theguardian.com/business/2016/nov/07/mcdonalds-claims-20m-from-florence-over-piazza-restaurant-rebuff

    Don’t work for the fuckers, don’t go there, don’t eat their vile product. Sooner or later? Gone.

  3. chris McMahon says:

    good solid union work. Well done.

  4. Sally's Husband says:

    This is precisely why we need good, solid well-resourced Unions. Excellent job, Unite Union!!

    As for McDonalds, well, let’s just say we won’t be taking the kids back there for a while. The taste in our mouths from this scandal is not good. I’m definitely NOT ENJOYING IT!!

  5. Geoff Lye says:

    Well done First union.

  6. James Dann says:

    We much prefer KFC.

  7. Mike the Lefty says:

    If you want to eat real food, you don’t eat at McDonalds.



Authorised by Martyn Bradbury, The Editor, TheDailyBlog, 5 Victoria St East/Queen St, CBD, Auckland, New Zealand.