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AG Becerra announces multistate settlements to block 'no-poach' for fast food workers

Christian Fernsby ▼ | March 3, 2020
California Attorney General Xavier Becerra announced that his office, as part of a multistate effort, secured a settlement with three major fast food companies that ends the use of 'no-poach' policies.
Xavier Becerra
Business in America   California Attorney General Xavier Becerra
These anticompetitive provisions harm workers by contractually preventing franchise operators from hiring or recruiting the employees of another franchise operator.

Topics: Settlement fast food worker

This artificially reduces competition for labor and makes it more difficult for employees, many of whom are low-wage workers, to seek better pay and benefits at competing franchises.

Workers are often unaware of the existence of these provisions.

As a result of the settlements, Burger King, Popeyes, and Tim Hortons will no longer include no-poach provisions in any of their franchise agreements in the United States.

“No-poach” provisions have been commonplace in many fast food outlet franchise agreements.

These provisions are also known as “no-solicitation,” “no-hire,” or “no-switching” agreements.

Ultimately, contracts that contain these provisions restrict a franchisee’s ability to recruit or hire employees from another franchise and significantly restrict an employee’s ability to seek new work and earn higher wages.

The agreements announced today are all with chains operated by Restaurant Brands International (RBI), which, according to RBI, operates approximately 26,000 restaurants in more than 100 countries and U.S. territories.


 

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