City finds McDonald's workers underpaid at Minneapolis franchise

For months, a McDonald's franchise in Minneapolis failed to pay dozens of workers the city's $10 minimum wage, which went into effect in January.

A city Department of Civil Rights investigation found the fast-food restaurant underpaid 51 employees at the 210 E. Lake St. location for more than two months, totaling $2,078 in lost wages, according to investigative documents obtained by the Star Tribune.

These findings mark one of the first wage cases since Minneapolis began its six-year climb to a $15-per-hour minimum pay for all employees. As city leaders look to follow through on promises to fight for the working class, they have created a new investigative unit tasked with making sure employers comply with the minimum wage and sick-and-safe time ordinances, which the City Council passed last year and hailed as a victory for workers.

The city began looking into the McDonald's after six workers filed complaints about their wages, said Taylor Shevey, an organizer for Centro de Trabajadores Unidos en Lucha (CTUL), a group that helps support fast food and retail workers in the campaign for better pay.

"They're stealing from our pockets and I would like to see that fixed," said Steven Suffridge, a 43-year-old janitor who has worked at the McDonald's location for four years. Suffridge has participated in strikes across the Midwest on behalf of low-wage workers in the fight for a $15 minimum along with CTUL, he said.

He was disappointed to learn his own employer had been paying him and many of his co-workers below the $10 minimum. "I just would like justice to be had," he said.

Through a McDonald's spokeswoman, franchise owner Connie Williams acknowledged underpaying employees but said it was an honest mistake. "This was an inadvertent error that we corrected immediately, and [we] have not received a notice or otherwise from the city of Minneapolis."

The spokeswoman, Anne Christensen, said Williams has voluntarily paid the lost wages to her employees and is now in compliance with the law.

However, Suffridge said he is still awaiting his back wages, and Shevey said many other workers still have not received compensation for being underpaid.

When asked about the apparent discrepancy, Williams said she paid those affected by the error and is "further investigating this matter to ensure no additional employees were impacted," according to a statement provided by Christensen.

The citywide minimum wage rose from $9.65 to $10 for large businesses on Jan. 1. In July, it will bump up to $11.25 for businesses with more than 100 employees and $10.25 for smaller ones. The minimum wage will continue to rise and reach $15-per-hour for all businesses in 2024, following the path of cities like Seattle and San Francisco.

The Minneapolis civil rights investigation found that in the first months of the year Williams paid 51 employees between $9.50 and $9.90, according to the documents.

Some workers were underpaid just a few dollars, others shorted more than $100. Over several months, the margins added up. Civil Rights Director Velma Korbel sent Williams a letter in March notifying her of the allegations and the city's investigation.

The city has not issued a final determination on the case. Spokesmen for Mayor Jacob Frey and the city of Minneapolis both declined to comment on the case, saying it's still under investigation.

If the city does choose to impose a penalty, the ordinance gives latitude over how to deal with employers found to be in violation of the new law, from ordering back pay to fining up to $1,000 per violation. McDonald's could also fight the sanction.

This isn't the first time McDonald's has been accused of underpaying workers. In 2014, during the campaign for the minimum wage increase, about 75 people, including many employees, participated in a strike outside the McDonald's in Uptown as part of a nationwide protest for better pay.

In 2015, McDonald's Chief Executive Officer Steve Easterbrook announced all corporate-owned McDonald's would begin paying $1 above local minimum wages, but workers told Bloomberg News for an April 2018 article that the company has not followed through on the promise.