Labor Board sides with McDonald's in landmark case

New York (CNN Business) The National Labor Relations Board decided Thursday that McDonald's can settle a case that accuses the burger chain of retaliating against employees who tried to unionize.

The case stems from a series of complaints filed against the company and some of its franchise operators in 2014, which were later consolidated. The Fast Food Workers Committee and Service Employees International Union alleged that workers who participated in strikes were punished with reduced hours and in other ways.

The central question in the case is whether McDonald's should be considered a joint employer with its franchise operators.

More than 90% of McDonald's locations are owned and operated by franchisees. McDonald's says that it encourages, but cannot mandate, that franchise operators follow company guidelines on sexual harassment and conduct sensitivity or other trainings. It argues that franchisees are responsible for their own employees.

If the corporation were to be considered a joint employer, McDonald's could be faced with a lot more litigation.

Last year, McDonald's and the NLRB's General Counsel Peter Robb, who was nominated to the position by President Donald Trump, attempted to settle the complaints through an agreement that would not name McDonald's a joint employer.

At the time, the judge overseeing the case denied the settlement proposal, saying that the agreements, which would give affected employees back pay, "do not in any way approximate the remedial effect" of a joint-employer finding.

The NLRB reversed that decision Thursday, arguing that the case may not be able to determine whether McDonald's should be considered a joint employer.

McDonald's said it was "pleased that the unfair labor practice proceedings involving McDonald's USA and the various franchisees across the country are now concluded through the NRLB's decision today," adding "we appreciate the efforts of the National Labor Relations Board and General Counsel Robb to bring this multi-year litigation to an end."

The company added that "the settlement, which the NLRB approved in its decision today, allows our franchisees and their employees to move forward, and resolves all matters without any admission of wrongdoing. Additionally, current and former franchisee employees involved in the proceedings can now receive long overdue satisfaction of their claims."

Matt Haller, senior vice president of government relations and public affairs for the International Franchise Association, a lobbying group, said in a statement that he was "thrilled" by the decision. "Franchise businesses are separate businesses; holding one business responsible for the actions of a different business that it does not and can not control is utter nonsense," he said.

But the group called The Fight for $15 and a Union, which advocates for workers rights, said it will "forcefully" appeal.

"McDonald's is walking away with a get-out-of-jail-free card after illegally retaliating against low-paid workers who were fighting to be paid enough to feed their families," the group said in a statement. "The settlement is not valid."

Micah Wissinger, an attorney who helped represent fast food workers in the case, said that the settlement "keeps the heat off of McDonald's, and it keeps the responsibility decentralized," adding that the company is trying to "sidestep any real decision."