Business

McDonald’s settles discrimination lawsuit against Herb Washington

Herb Washington poses for a portrait outside his McDonalds in Niles, Ohio, Thursday, January 3, 2002.

Ron Schwane | AP

McDonald’s said on Thursday it had settled a lawsuit against the fast food giant Herb Washington, a Black franchisee who has accused the company of racism.

Washington — a former Baseball League Baseball player and the largest Black franchisee in America at one point — operated 14 McDonald’s restaurants at the time he filed the lawsuit, falling compared to 23 in 2017.

In exchange for an agreement to exit the McDonald’s system and dismiss the pending litigation, McDonald’s purchased 13 restaurants for $33.5 million. The fast food giant said the amount is considered a fair price for restaurants.

“The court did not find that the company violated any laws,” McDonald’s said in a statement. “Discrimination has no place at McDonald’s. While we are confident in the strength of our case, this resolution aligns with McDonald’s values ​​and allows us to continue to focus on our priorities. our commitment to the communities we serve.”

Washington has accused the company of discriminating against him by letting him run small-scale restaurants in black neighborhoods and by forcing him to downsize his store base significantly. years later after unfairly classifying his positions.

Washington said in a statement at the time of filing: “As I stood up to myself and other Black franchisees, McDonald’s began to tear down my life’s business, forcing me to sell store after store for white executives.”

Last week, McDonald’s also settled a similar lawsuit brought to Tennessee by two black operators, James and Darrell Byrd. The franchisees, who are brothers, accused McDonald’s of favoring white operators. They are looking for up to $5 million per store to cover their loss.

McDonald’s agreed to buy four restaurants for $6.5 million, and the Byrds agreed to drop the lawsuit and leave the system. Similarly, the court did not find that McDonald’s violated any laws, the company said.

The fast food giant still has a prominent lawsuit filed on behalf of 77 former Black franchisees alleging racial discrimination.

Separately, McDonald’s last week announced that it would be recruiting and training more diverse franchise operators globally. It also pledged to invest $250 million over five years to help fund loans for underrepresented groups.

Earlier Thursday, McDonald’s said its board had reached a deal with former CEO Steve Easterbrook. The disgraced executive has agreed to return $105 million in cash and an equity award the company said he would lose if he told the truth by the time he was fired in November 2019.

https://www.cnbc.com/2021/12/16/mcdonalds-settles-discrimination-lawsuit-with-herb-washington.html McDonald’s settles discrimination lawsuit against Herb Washington

Emma James

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