Eight More Restaurant Chains Agree To End 'no-poach' Practices

(RTTNews) - Eight more fast-food chains have agreed to remove "no-poach" provisions from their franchise contracts nationwide. The no-poach provisions prevented low-wage workers from finding higher-paying jobs at other restaurants of the same fast-food chain.

Applebee's, Church's Chicken, Five Guys, IHOP, Jamba Juice, Little Caesars, Panera and Sonic have agreed to immediately end the practice at all locations across the country and also stop adding the provisions to new franchise contracts.

The companies agreed to end the practice under the threat of a lawsuit from Washington state Attorney General Bob Ferguson's office. The legally binding agreements were filed in King County Superior Court.

As employees cannot move to another location within the same restaurant chain, their current location had less incentive to give them raises. Such no-poach clauses thus reduced opportunities for low-wage workers and stagnated wages.

These eight companies have 90 to 120 days to remove any no-poach provisions from their existing franchise contracts in Washington. Outside of Washington state, the fast-food chains must remove the no-poach language from existing contracts as and when they come up for renewal.

The agreements will affect more than 15,000 locations of these eight fast-food chains nationwide and positively affect hundreds of thousands of workers nationwide, Ferguson noted.

"Businesses can't rig the system to avoid competition. My goal is to eliminate no-poach clauses in the fast-food industry nationwide," said Ferguson.

The no-poach provisions appear in franchise agreements that owners of fast-food franchises sign with corporate headquarters. As these agreements are not signed by the workers themselves, they are generally unaware the provisions even exist.

Seven other restaurant chains - Arby's, Auntie Anne's, Buffalo Wild Wings, Carl's Jr., Cinnabon, Jimmy John's and McDonald's - earlier agreed to end the practice.