* Press release…

Attorney General Kwame Raoul, as part of a coalition of 14 attorneys general, announced settlement agreements under which three national fast food franchisors will cease using “no-poach” agreements, which restrict the right of fast food workers to move from one franchise to another within the same restaurant chain.

The agreements entered with the chains Burger King, Popeyes Louisiana Kitchen and Tim Hortons, which are owned by Restaurant Brands International, are the result of an investigation into national fast food franchises announced by the states in July 2018 over concerns that no-poach agreements hurt low-wage workers by limiting their ability to secure better paying jobs.

“I will continue to push restaurants to end their use of no-poach agreements, which allow businesses to take advantage of low-wage workers,” Raoul said. “These agreements stop employees from seeking higher-paying opportunities and escaping the cycle of poverty.”

Under the terms of the settlements, the franchisors have agreed to stop including no-poach provisions in any of their franchise agreements and to stop enforcing such provisions in any franchise agreements already in place. The franchisors also have agreed to amend existing franchise agreements to remove no-poach provisions and to ask their franchisees to post notices in all locations to inform employees of the settlement.

Raoul and the coalition began their investigation in July 2018 by sending letters to Arby’s, Burger King, Dunkin’ Brands, Five Guys Burgers and Fries, Little Caesars, Panera Bread, Popeyes Louisiana Kitchen, and Wendy’s requesting documents, including copies of franchise agreements and communications related to no-poach provisions. Raoul and the coalition alleged that no-poach provisions make it difficult for workers to improve their earning potential by moving from one job to another or seeking a higher-paying job at another franchise location. Additionally, Raoul and the coalition argued that many workers are unaware they are subject to these no-poach provisions.

In March 2019, the attorneys general announced they had reached settlements with Dunkin’, Arby’s, Five Guys, Little Caesars and Panera under which the restaurants agreed to cease using no-poach provisions in their franchise agreements. These franchisors have reported that all franchisees in the settling states amended their franchise agreements to remove the no-poach provisions. Wendy’s provided confirmation that it never used no-poach provisions in their contracts with franchisees.