The new civil rights suit against one of the world's largest fast-food chains joins a catalogue of discrimination allegations over the past few years. Allegations include the denial of the opportunity to own stores in more affluent areas, the increased costs associated with running outlets in poorer areas, and the resultant difference in revenues for black franchisees as compared to their white counterparts, reports SIDDHARTH GANGULY.
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HERBERT Washington, an owner of 14 McDonald's franchises, filed a civil rights lawsuit against the fast-food giant earlier this week. The suit, filed in a federal court in Youngstown, Ohio, accuses McDonald's of giving preferential treatment to white franchise owners and denying similar opportunities to their black counterparts.
The lawsuit claims that the restaurant chain gives black franchisees the option to run outlets only in the oldest and toughest neighbourhoods. In a video conference interview with the Associated Press, Washington notes the additional costs which have to be borne, such as a need to employ security, He goes on to state that, "The cash flow differential in different parts of the state can be hundreds of thousands of dollars per store less than their white counterparts."
A similar suit was filed last year in a federal court in Illinois, where McDonald's is based, by 52 black former franchise owners. These individuals owned 200 franchises and gave up ownership between 2010 and 2020. The suit claimed that the average annual revenue of the plaintiffs' outlets was around $2 million, $700,000 less than the company's national average between 2011 and 2016.
This suit cited a Business Insider report which showed that, while there were 304 black franchisees of the company in 2008, the number had fallen to 222 by the end of 2017. The report also details that, on average, a black franchisee store earned $68,000 less per month than one run by a white person.
As reported by the BBC, Washington, at one point, owned 27 McDonald's outlets, but subsequently had to sell a number of them to white owners. He now owns 12 outlets in Ohio and two in Pennsylvania. "I always held out hope that they would live up to their promises and put an end to a two-tiered system." He said.
McDonald's refuted Washington's claims in a statement issued on Tuesday. The company chalked up the black franchisee's poor sales to "business challenges" and went on to say, "This situation is the result of years of mismanagement by Mr Washington, whose organization has failed to meet many of our standards on people, operations, guest satisfaction and reinvestment," as reported by The Guardian.
Washington was an all-American sprinter and even played for the professional baseball team, the Oakland Athletics, from 1974-75. His suit is the latest in a list of accusations of racial discrimination McDonald's has faced in the past few years.
(Siddharth Ganguly is a journalism student at the Symbiosis Institute of Media and Communication, Pune, and an intern at The Leaflet.)