McDonald’s has agreed to pay $33.5 million to a Black franchisee who sued the fast-food company for racial discrimination in February. According to the Associated Press, retired baseball player Herb Washington accused the firm of favoring White owners and denying him the opportunity to buy eateries in more luxurious locations.
According to Face2Face Africa, Washington controlled 14 McDonald’s stores at the time the complaint was filed. He was also formerly the largest Black franchise operator in the United States for the fast-food giant.
The fast-food giant said in a statement on Thursday that the money it was paying Washington was for 13 franchises and that it was “no more than what we think a fair price for the value of the locations.”
“While we were confident in the strength of our case,” McDonald’s said, “this resolution coincides with McDonald’s principles and allows us to continue focused on our commitments to the communities we serve.” “Discrimination has no place in McDonald’s,” the fast-food giant added.
Washington will dismiss the racial discrimination case and cease to be a McDonald’s franchisee as part of the settlement deal. According to the BBC, the former baseball player alleged in the lawsuit that Black McDonald’s franchise owners were pressured to open outlets in “distressed, predominantly black” regions.
Washington stated that after voicing his complaints, the fast-food company took action against him and continually stifled his growth. He also mentioned the firm denying him the opportunity to buy a White franchise owner’s store and not providing him with the same financial aid packages as his White counterparts.
“McDonald’s has targeted me for extinction. “The arches are waging full-fledged revenge against me,” Washington claimed at the time, adding that the corporation had pushed him to sell some of his stores in exchange for contract extensions on others.
According to the lawsuit, the issue worsened when the company’s previous CEO, Steve Easterbrook, took office in 2015, according to BBC. According to the lawsuit, Easterbrook implemented measures “intended to push black franchisees out of the McDonald’s chain.”
The lawsuit cited that the number of Black-owned McDonald’s outlets had decreased from 377 to 186 since 1998. According to the lawsuit, White-owned franchises make $700,000 more in annual sales than Black-owned stores.
This isn’t the company’s first time being accused of discrimination. Over 50 former Black franchise owners are said to have launched a lawsuit against McDonald’s last year, alleging that the firm forced them to open restaurants in unfavorable areas. According to the Associated Press, the Black owners claimed they had to dig deep into their pockets to cover security and insurance fees, and the company did not provide them with rent help for improvements, despite White owners apparently receiving such assistance.
McDonald’s reportedly launched a $250 million package last week to support and hire minority franchisees.