By Annie Gasparro And Eric Morath
McDonald's Corp. plans to raise pay by more than 10% and add
benefits like paid vacation for workers at U.S. restaurants it
operates, an effort to rejuvenate the struggling fast-food giant
that offers fresh evidence of rising wage pressure in the American
labor market.
Starting July 1, McDonald's will pay at least $1 per hour more
than the local legal minimum wage for employees at the roughly
1,500 restaurants it owns in the U.S. The increase, which
McDonald's said will apply to some 90,000 workers at all levels of
experience and rank, will lift the average hourly rate for its U.S.
restaurant employees to $9.90 on July 1 and more than $10 by the
end of 2016, from $9.01 currently. McDonald's also will enable
workers after a year of employment to accrue up to five days of
paid time-off annually.
The changes come amid mounting criticism from labor groups over
wages and conditions at McDonald's and other fast-food chains. The
move doesn't apply to employees of the franchisees who operate
nearly 90% of the 14,350 U.S. McDonald's--a fact critics may seize
on. McDonald's says franchisees are free to set their own pay
policies. The company said it does plan to make subsidies for some
education costs available to all U.S. workers as part of its
plan.
McDonald's Chief Executive Steve Easterbrook, who took over on
March 1, said the policy is a response to employee surveys and is
central to his plans to revive sales after more than two years of
declines. "What we need to underpin that is highly motivated teams
in our restaurants," he said in an interview. "Motivated teams
deliver better customer service and delivering better customer
service in our restaurants is clearly going to be a vital part of
our turnaround."
Write to Annie Gasparro at annie.gasparro@wsj.com and Eric
Morath at eric.morath@wsj.com
Access Investor Kit for McDonald's Corp.
Visit
http://www.companyspotlight.com/partner?cp_code=P479&isin=US5801351017
Subscribe to WSJ: http://online.wsj.com?mod=djnwires