McDonald's to hike restaurant workers' salaries by over 10 percent: WSJ

Reuters News
Posted: Apr 01, 2015 3:41 PM

SAN FRANCISCO (Reuters) - McDonald's Corp plans to raise U.S. restaurant workers' pay by more than 10 percent and tack on benefits such as paid vacations, according to a Wall Street Journal story citing the fast-food chain's new chief executive.

The reported move from the world's biggest restaurant chain follows entry-level wage hikes by Wal-Mart Stores Inc and other retailers and lands amid frequent fast-food and retail worker protests calling for higher pay and better working conditions.

According to the report, McDonald's will raise pay at least $1 above the local minimum wage for roughly 90,000 workers in some 1,500 restaurants the company operates in the United States.

The increase will take the average hourly rate for those workers to $9.90 by July 1, up from $9.01 currently. McDonald's also plans to take average pay above $10 by the end of 2016, according to the report.

The immediate impact of the move will be limited.

That is because almost 90 percent of McDonald's more than 14,000 U.S. restaurants are operated by franchisees who set pay and benefits for their own workers.

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Still, experts said McDonald's move could put pressure on franchisees to increase worker wages. That could force those business owners to raise food prices to cover additional labor costs, a move that could benefit McDonald's because its franchisees pay the company royalties based on sales.

McDonald's did not immediately comment on the move.

(Reporting by Lisa Baertlein; Editing by Chris Reese)