An analysis of McDonald’s Restaurants’ workplace agreement has revealed that the burger behemoth is paying much of its workforce less than the minimum award wage. The 2013 McDonald’s Australia enterprise agreement – negotiated by the sell-out-prone Shop, Distributive and Allied Employees Association – cuts all late night and weekend penalty rates for the 100,000 strong McDonald’s workforce. 

The detail of the deal was recently examined by tertiary education union official Josh Cullinan, whose findings were first reported by Fairfax Media. Based on a review of hundreds of rosters and payslips, Cullinan revealed that some McDonald’s workers are being paid two-thirds of what they would get under the award, which is supposed to be the basic “safety net” of minimum standards. The average wage loss across the McDonald’s workforce is $1,000 a year per worker, but some are around $6,000 a year worse off. Cullinan estimates that the agreement saves McDonald’s at least $50 million a year on penalty rates alone.  

Speaking to Red Flag, he explained how young McDonald’s workers are particularly hard hit. “As a proportion of wages earned, young workers were worse off because they were earning less, so $1,000 for a 14- or 15-year-old is the same as $2,500 for an adult [on adult wage rates].”  

Last year, Cullinan undertook a similar analysis of the 2015 Coles Supermarket enterprise agreement. Compared to the award, he found that the national agreement allowed Coles to rob its 75,000 workers of around $60 million a year in wages, including most of the penalty rates they would get under the award.  

Shocking as these rip-offs are, there’s nothing unusual about the way Coles and McDonald’s pay their workers. Australia’s other supermarket giant, Woolworths, has a national agreement that is almost identical to the Coles deal. In fact, Cullinan says that arrangements are similar across the fast food and retail industries. “We are looking at almost 500,000 workers affected to the tune of $300 million per annum”, he roughly estimates. 

It might seem curious that such colossal rorts, involving some of Australia’s largest companies, have been exposed by a lone unionist with an eye for detail, a knack for Excel spreadsheets and a willingness to spend his spare time crunching the numbers. What about the country’s well-resourced industrial regulators – the twin Fair Works Commission and ombudsman? How have these major companies kept their shady practices hidden from the “independent umpire” for so long?

The answer to that is the real scandal behind this massive corporate swindle. Each of these agreements has been reviewed and waved through by the commission. Cullinan points out: “It isn’t necessarily accurate to describe these as underpayments, because the arrangements get made law by the Fair Work Commission”.

In the case of the 2013 McDonald’s agreement, the commission approved it in a decision that runs to eight sentences in length. A Maccas worker would have a tougher time getting out of a parking fine from the local council than their multinational boss did getting wholesale wage theft made legal by Australia’s industrial relations “umpire”.

 What about the Fair Work ombudsman? Workers won’t do any better there. McDonald’s Australia is a darling of that institution. The ombudsman’s website boasts about its long term partnership with the fast food franchise. McDonald’s, the ombudsman said, “goes beyond meeting minimum obligations” and “continues to look for ways to improve”. 

So impressed with McDonald’s is the ombudsman that in a speech delivered to the Australian Industry Group on 2 May, she implored business representatives in the room to follow its lead. If she’d also pointed out that there was a $50 million annual wage theft bonanza in it for companies that followed the McDonald’s path, they probably wouldn’t have needed much convincing.

It has never been clearer that workers have no friend in these bodies. Increasingly, even the most basic minimum standards are ignored or easily shoved aside to suit business demands. If McDonald’s can legitimately claim to be playing by the rules, we know that the whole game is rigged.