McDonald’s franchisee fined for using child labor; government agency misclassified staff

Some staff have been paid too much; while other workers have not been paid at all. Check out this week's top HR stories that caught our eye:

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May 5, 2023

McDonald’s franchisee fined for using ten-year olds as unpaid workers

A Kentucky-based McDonald’s franchisee has been found to have violated federal labor laws, by using children – some as young as 10 – as unpaid workers. The children, who prepared and distributed food orders; worked at a Drive-Thru window, and operated the register, would sometimes be working till as late as 2am in the morning, found the Department of Labor. All-told, DOL investigators found the store employed 24 minors under the age of 16 to work more than legally-permitted hours. “These reports are unacceptable, deeply troubling and run afoul of the high expectations we have for the entire McDonald’s brand,” commented Tiffanie Boyd, senior vice president and chief people officer at McDonald’s USA. She added: “It is not lost on us the significant responsibility we carry to ensure a positive and safe experience for everyone under the Arches.” The DOL issued fines of nearly $40,000.

Misclassifying employees found to have cost government $20 million

The Bureau of Alcohol, Tobacco, Firearms and Explosives has been accused of “substantial waste and mismanagement” after it was revealed to have over-paid employees to the tune of $20 million due to misclassifying its own staff. Around 108 employees were classified as being in law enforcement posts when they were not, meaning that over a five year period, they were improperly provided Law Enforcement Availability Pay (LEAP) and enhanced retirement benefits. It was also revealed that the $20 million said to have been lost “could be much higher, given that the unlawful job classifications had been common practice at ATF far longer than the five-year time frame reviewed by investigators,” the US Office of Special Counsel said. The investigation was initiated, following the action of two whistleblowers in ATF’s human resources department. They alerted officials about practices involving “gross waste of funds” and “gross mismanagement.” They said the agency had a long-standing policy of helping the careers of special agents and industry operations investigators by systematically misclassifying high-level non-law enforcement jobs and filling “these coveted, primarily supervisory jobs with only special agents.”

Worker celebrates 50 years’ service

With the average tenure in a job now just 4.1 years, this is news story we won’t be seeing too often – one worker celebrating a staggering five decades with a single employer. Sandra Gajtka recently chalked up 50 years working for the United States Postal Service. Initially encouraged to apply for a job there by her aunt, she met her husband there and was a steward at the American Postal Workers Union between 1974-2000, before serving as its president between 2000-2013. “I was here before automation,” said Gajtka, who works as the sales, service and distribution associate. “Everything was done by hand.” According to bosses, she is still amongst the first to arrive at work each day, at the Penco Road post office, and simply “gets things organized.” She says she attributes her longevity in her role to remembering the advice of her late father, which was to ‘not do anything to get fired.’

Financial stress listed as top wellness concern…

New data from BrightPlan’s third annual Wellness Barometer Survey reveals a staggering 92% of employees say they are stressed about their finances. The vast majority of those dealing with financial stress say it has got to the point where it has worsened their mental and physical health (72% and 60%, respectively), while 64% say it’s impacted their social wellbeing – that is, their relationships with their friends and family. The top contributors to workers’ financial stress were found to be high inflation (from 96% of respondents); worries about an impending recession (93%); rising interest rates (90%) and general market volatility (89%). The result, found the research, was that 72% of respondents said they had passed up opportunities to spend time with family, friends, and co-workers because they felt they couldn’t afford to. Events missed include weddings and birthdays or turning down invitations to get drinks or food. In addition to impacting employees’ health, financial stress was found to negatively affect people’s engagement (50%) and productivity (48%) at work.

…as top US CEO pay increases by 7.7%

So much for everyone’s in it together. Median pay for top US CEOs rose by an inflation-busting 7.7% last year, according to data released this week by Equilar. This means their typical salary now stands at a record $22.3 million. The study reviewed the 100 highest paid CEOs at US public companies with revenue of $1 billion or more. The gains these CEOs got saw their pay reach 288 times that of their median employee – up from 254 times in 2021. But some will likely question if they’re worth it. CEO pay gains came during a year when the total return of the S&P 500 was negative 18% and as total return for the companies whose CEO pay was studied was negative 11%. One of the biggest pay increases went to Jefferies CEO, Richard Handler, whose $56.9 million received last year was nearly double his total compensation in 2021. Another big gain went to Hamid Moghadam, CEO of logistics real estate company, Prologis, whose $48.2 million total compensation last year was 93% more than the year before, driven mainly by stock awards.

Google bans UK staff from using gendered language

An edict sent from execs at Google has banned its British workers from using ‘gendered’ words or those that might have racial/mental health connotations when speaking to their US-based colleagues. Banned words apparently include popular phrases like “hey guys” and “man hours,” as well as words such as “black hole,”chubby,” “crazy,” “bonkers” and “mad.” The ban on “you guys,” is said to be justified in the guide by a need for gender-neutral language. “When referring to a group of people, use non-gendered language such as everyone or folks,” the memo reportedly states. But it has not gone down well. “We’re much too busy to be worried about whether some totally harmless phrase that’s been used for years might upset someone, somewhere,” said one British employee. Google said its dossier provided “editorial guidelines for writing clear and consistent Google-related developer documentation.” Google has reportedly not responded to requests for whether these restrictions also apply to their US employees.

US job openings dip to lowest level since 2021

New data shows US job openings fell in March, to their lowest level for nearly two years. The news will no doubt add to already mounting concerns that the hitherto robust employment market is starting to cool off. The 9.6 million vacancies posted in March is down from the 10 million posted in February, according to The Labor Department’s Job Openings and Labor Turnover Summary (JOLTS). In addition to this, the number of people who quit their jobs dropped to 3.9 million in March – the lowest since May 2021 – indicating falling confidence amongst workers of being able to find a better job elsewhere. In an assessment statement from Contingent Macro Advisors, it said: “Overall the JOLTS report shows a historically tight labor market that is finally starting to slacken more quickly, something Fed officials have been seeking for several quarters.” According to AP, the upshot of changes to the labour market means America’s unemployment rate is expected to blip up to 3.6% for April, a couple of notches above January’s half-century low 3.4%. US job openings have now fallen for a third month in a row, while layoffs have risen to their highest level for more than two years.

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