According to Herbert Washington, a former Oakland Athletics player and current owner of 14 McDonald’s franchises, the fast food company known for its golden arches is limiting the ability of black owners like him to operate their restaurants profitably.
Washington made the accusation in a civil rights lawsuit it filed against the food service giant on Tuesday, AP reports.
Franchises in low-income neighborhoods cost more to operate, have higher employee turnover, and aren’t as profitable, depending on demand.
“By relegating black owners to older stores in the toughest neighborhoods, McDonald’s ensured that black franchisees never achieved the levels of success that white franchisees could hope for,” the lawsuit says. “Black franchisees must spend more to operate their stores, while white franchisees realize the full benefits of their work.”
More than 50 former Black McDonald’s franchise owners made claims similar to Washington’s in a lawsuit filed against the company in September, saying they were forced to sell about 200 stores in the last decade.
Although Washington says thThe company’s treatment of black franchise owners has resulted in a significant $ 700,000 sales gap between white-owned and black-owned franchises, McDonald’s has challenged its claims. In a statement released Tuesday, the company responded to the financial disparities Washington has flagged by essentially blaming it for being a bad deal.men.
“This situation is the result of years of mismanagement by Mr. Washington, whose organization has failed to meet many of our standards on people, operations, guest satisfaction, and reinvestment,” McDonald’s said.
Washington previously owned 27 McDonald’s stores, but it also alleges that the company sold seven of its franchises to white owners over the years.
According to its lawsuit, the number of McDonald’s franchises owned by black franchisees has declined over the past two decades from 377 to 186. In its statement, the company said the percentage of black-owned stores “has remained virtually unchanged.”