$26 Million Dollar Settlement to California McDonald’s Employees for Wage Theft

On November 22, 2019, McDonald’s agreed to pay $26 million to a class of California employees for various wage violations.  The settlement provides relief to approximately 38,000 current and former McDonald’s employees that worked at California restaurants at any time since 2009. 

Employees claim McDonald’s violated California labor law by, among other things, implementing a timekeeping system that failed to accurately capture employees’ time worked.  Specifically, employees allege that McDonald’s rounded the hours they worked to when an employee’s shift started as opposed to when they began working.  Further, McDonald’s timekeeping system informed managers when employees were entitled to overtime premium pay and allowed managers to alter employees’ time records to remain under premium pay thresholds and reduce labor costs.  The proposed settlement requires McDonald’s to revise its timekeeping practices to comply with California State law and to provide training sessions on wage policies.

Workers should recognize that, in addition to state labor laws, the federal Fair Labor Standard Act also provides that employers must compensate workers for all identifiable time worked.  Notably, employers may round their workers’ time in instances where an employer utilizes time clocks, but it is imperative that the employer’s rounding system does not unfairly limit the time worked by employees.  Workers should review their time records and paystubs to ensure that their employers are properly compensating them for all hours worked and not engaging in a system where the employer rounds their time unfairly.