Treating workers like they are disposable is bad business
McDonald’s workers in 15 US cities recently staged a weeklong strike demanding an hourly wage of $ 15 for every McDonald’s worker. McDonald’s resisted, engagement only increase average salary at $ 13 an hour.
In the meantime, the profits continue to flow. The fast food giant posted $ 4.7 billion in profits in 2020. CEO Chris Kempczinski personally pocketed $ 10.8 million last year, 1,189 times more than the $ 9,124 that went to the company’s median worker.
McDonald’s executives seem to think they can survive the Fight for $ 15 campaign. Specifically, they think they know it all. Nothing come at Mickey D’s without incredibly intensive market research: “Plan, test, comment, adjust, repeat.” It may take more hours to plan the launch of a new McDonald’s menu item than for Ike to organize the planning for the D-Day invasion.
All of this planning has given McDonald’s executives supreme confidence in their business skills. But, in fact, these frames make do not know their business inside out. They don’t know their workers.
Workers remain a disposable item for McDonald’s executive class. Why pay them decently? While some workers feel underpaid and overworked, the McDonald’s corporate attitude has always been “good riddance for them.” McDonald’s turnover was ongoing at an annual rate of 150 percent before the pandemic.
The entire fast food industry is built on a basis of low wages and high turnover. And at those rare times – like this spring – when new workers seem harder to find, the industry start to expect his politician friends cut jobless benefits and force workers into jobs that do not pay a living wage.
But if the leaders really did their research, they would quickly learn that it doesn’t make sense. Instead of treating workers as disposable and replaceable, companies should treat them as partners.
Who says? the harvard business review, hardly a paradise for anti-corporate slogans. Employee shareholding, the newspaper concluded recently, “can reduce inequalities and improve productivity”.
Thomas Dudley and Ethan Rouen have reviewed a multitude of studies on companies where employees own at least 30% of the shares of their company. These companies are more productive and grow faster that their counterparts, Dudley and Rouen have found. Cooperatives are also less likely going bankrupt.
Companies that have at least 30 percent employee share ownership currently employ about 1.5 million U.S. workers, or just under 1 percent of the country’s total workforce. If we raise that number to 30%, calculate Dudley and Rouen, the bottom half of Americans would see their share of national wealth more than quadruple.
Elsewhere, there are already companies with 100% employee share ownership. The Spanish cooperatives of Mondragon, the New York Times Noted earlier this year, have flourished since the 1950s. They aim “not to pay dividends to shareholders or to pay stock options to executives, but to preserve paychecks.”
In each of Mondragón’s 96 cooperative enterprises, executives earn no more than six times what workers in Spanish cooperatives in the network earn. In the United States, the typical rate works well over 300 to 1.
We are not talking about artisan shops here. Mondragón’s cooperatives, including one of Spain’s largest grocery chains, currently employ 70,000 people in the country.
Mondragón has had a particularly powerful impact on the Basque region in Spain, the home port of the network. By a standard measure, the Basque region currently ranks as one of the most egalitarian policy areas on the planet.
“We want to transform our society,” said Josu Ugarte, President of Mondragón International said in an interview in 2016. “We want a more equal society.”
The same goes for McDonald’s workers.
Sam Pizzigati is co-editor of Inequality.org and author of The Case for a Maximum Wage and The Rich Don’t Always Win.