Since January, Attorney General Bob Ferguson has investigated corporate fast-food chains for “no-poach” clauses that prevent employees from moving to a different location to obtain higher wages. Earlier this summer, Ferguson announced seven corporations that have agreed to remove the no-poach language from their contracts. Yesterday, Ferguson announced that eight more corporations will remove the restrictive provisions in current and future contracts nationwide.
These eight fast-food restaurants are Applebee’s, Church’s Chicken, Five Guys, IHOP, Jamba Juice, Little Caesars, Panera, and Sonic. In July, seven other companies — McDonalds, Carl’s Jr., Jimmy John’s, Arby’s, Buffalo Wild Wings, Cinnabon, and Auntie Anne’s — agreed to remove no-poach clauses to avoid a lawsuit from Ferguson’s office.
As a result, hundreds of thousands of additional workers at 15,000 more restaurant locations will gain job mobility and cease experiencing stagnation in their wages.
“Businesses can’t rig the system to avoid competition,” Ferguson said in a statement. “My goal is to eliminate no-poach clauses in the fast-food industry nationwide. This is a major step forward in achieving that goal, but we’re not done. Other fast food companies that use no-poach provisions are now on the clock to accept a similar deal or face litigation from my office.”
No-poach provisions prohibit employees from moving from among restaurants in the same corporate chain, which decreases job competition, reduces opportunities for low-wage workers, and stagnates wages. The Antitrust Division launched this investigation against no-poach clauses in January in order to end the practice, which Ferguson argues is in violation of the Washington’s Consumer Protection Act.
The eight companies are legally bound to end the practice at all locations nationwide immediately.