Thursday, August 14, 2014

Stealing Time

Readers of this blog (assuming I have readers) who live in the Western US or other parts of the world may not be familiar with the Jimmy John’s chain of sandwich shops. The company is a Subway competitor, with two major differences: the quality of their food is much higher and their business model is based almost entirely on take-out and delivery service. In fact, many of the locations in Central Michigan don’t even have seating; if you purchase food there you will have to find somewhere else to eat it. I’ve been a regular customer ever since we first encountered the chain, during the first week we were here in Lansing. It really annoyed me to find out that some of the franchises are being sued for stealing time from their employees – especially considering the wider implications of that crime…

You can pick up the story here if you’d like, but the basic concept is simple enough – and much more common in the US than I wish it was. Two of the Jimmy John’s franchises are being sued by former employers who claim that the franchise owners routinely required them to work “off the clock” without pay or other compensation. In practice, this has the effect of lowering the minimum wage, and therefore the payroll expenses experienced by the business. Employees are given the choice of working for less money or being fired, and during bad economic times they may need the job badly enough to put up with such demands…

It’s unusual to encounter this kind of chicanery in franchised businesses, since most franchisors have strict rules against the practice and in some cases can fine the franchise holder or even revoke their franchise agreement for doing so. People are likely to assume that the company is complicit in such exploitive practices even if they do realize that the locations in question are independently owned and operated; if they don’t realize the locations are franchised they will just assume that the corporation is screwing its own employees out of their minimum wages. Given that both the pay and the working conditions offered to fast food employees is already legendarily bad, no company wants to be associated with making things worse…

What may be getting lost in the shouting here, and is certainly being ignored in the highly politicized debates over a higher minimum wage, is the public impact of these wages and working conditions – and specifically, the fact that an increasing number of minimum wage workers are having to rely on public assistance just to stay alive. Fast-food companies – or quick-serve restaurants, to give them their industry title – have some of the highest operating margins of any major enterprise, and certainly have one of the highest ratios of how much the CEO makes relative to the average employee. Unfortunately, they are doing so by paying their employees starvation wages (sometimes literally) and dumping the cost onto the taxpayers; effectively a massive public subsidy for fast-food makers at your expense…

Now, I’m not going to suggest that every employee working far too hard for minimum wage is the head of a household trying to support multiple dependants on effectively no pay. Many of these positions are held by students, part-time workers, secondary wage earners in their households, and other who are not being driven to the edge just to provide a corporate executive with a larger bonus. My point here is that the fact that this is happening to anyone is an outrage, and the fact that these companies are effectively stealing your tax dollars as much as they are from the employees makes it a public disgrace. Requiring highly-paid employees working under exempt status to work more than 40 hours a week may be unethical and counter-productive, but at least it’s legal. Stealing time from your employees is Grand Larceny, plain and simple, and the people doing it should be charged as common thieves and prosecuted accordingly…

Dumping these expenses onto the public is effectively stealing the money that would otherwise be used for fire departments, police protection, public health, education and other vital services – and I don’t even have a name for that crime. But anyone who can accept a $20 million or $30 million salary while making his or her employees live on public assistance (or starve to death) needs to re-evaluate his or her personal values, assuming they still have any. And all of the people who are dead-set against raising the minimum wage should probably consider exactly who is paying for that public assistance, because it certainly isn’t the companies doing the exploiting – or shall we just call it stealing and have done with it? A crime by any other name…

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