Fast Food Chains Investigated Over 'No-Poaching' Agreements

Jul 10, 2018

A decommissioned Burger King sign photographed in Las Vegas, Nevada.
Credit FLICKR USER THOMAS HAWK / (CC x 2.0)

Illinois Attorney General Lisa Madigan is investigating fast food restaurants over hiring practices.

At issue are so-called no-poaching agreements. That’s where restaurant franchisees are prohibited from hiring people away from other franchise owners.

So, for example, someone who works at Bob’s Burger King cannot go down the street and get a job at Jim’s Burger King.

In a telephone interview, Madigan said this is particularly hard on low-income workers.

“What it ends up doing then is preventing people from being able to get promotions and therefore, assumedly, earning higher wages,” she said. “You have people who are already struggling to be able to support themselves and their families being further and illegally prevented from getting a better- and higher-paying job.”

Madigan joined with several other states to demand information from eight fast food companies: Arby’s, Burger King, Dunkin’ Donuts, Five Guys Burgers and Fries, Little Caesars, Panera Bread, Popeyes Louisiana Kitchen and Wendy’s.

Madigan previously took the Jimmy John’s chain to court. The company eventually dropped non-compete agreements meant to keep employees from taking jobs at other sandwich shops.