Is One Penny Per Pound Really Too Much to Ask of a $40 Billion Fast-Food Giant?

This past week, McDonald’s and a group of Florida growers announced what they are calling “rigorous new practices” that they say will, in combination with the previously announced “SAFE” initiative, “equal or exceed one penny per pound.”

One the one hand, it’s good to see that, only one month later, McDonald’s agrees with us on the inadequacy of SAFE. SAFE, on its own, was a woefully insufficient solution to the world of problems faced by Florida farmworkers.

And it is certainly encouraging to hear Florida tomato growers saying publicly that, “Agriculture is taking a closer look at its workplace culture to ensure that producers are doing the right thing.” Clearly, our campaign has managed to change the terms of the debate in Florida agriculture. Where growers and their clients before talked only about price, quality control, and food safety issues, today they are talking about ethical labor standards.

If Florida tomato growers can come to sincerely embrace these new ideas, they will see that there is value to be had in treating their labor with respect and joining with workers in a cooperative effort to eliminate labor violations and improve working conditions. If so, the growers could become a force for progress in the industry. Unfortunately, the standards the growers are now talking about implementing still fall well short of anything that can be honestly described as genuine corporate responsibility. As announced, the “new practices” lack any real collaboration with workers or provisions for guaranteeing just wages – both key principles of meaningful labor standards — but at least the movement is in the right direction.

Economic Relief Missing

But none of what has been announced addresses the fact that farmworkers still desperately need immediate economic relief, a raise in wages so that they can meet their basic needs and live free of the degradation that has been the shame of Florida agriculture for so long.

What continues to puzzle us is why McDonald’s refuses to pay just one penny more per pound and work with its growers to ensure that the additional penny goes to the workers in the form of a raise in the per bucket piece rate.

The company’s latest announcement at least recognizes the need to “meet or exceed” the Yum penny per pound standard, but the package of “new” benefits being offered in the place of a raise is really just a combination of basic employment benefits already required by law and practices already common in the tomato industry. There’s really not much new here at all.

In other words, all major tomato growers are already required to withhold money from their workers’ checks to pay for social security, workers compensation, and Medicaid, and the vast majority do so, while many of the major growers already house their workers in company labor camps and transport their workers in company buses.

As such, it’s just not plausible that the total of these “benefits” will somehow exceed the $6,000 or $7,000 per year that an industry-wide penny more per pound would put into workers’ pockets. What’s more, whatever the final value of any new benefits might be – and that will certainly be an issue of endless dispute — it will never be the same as paying a fair wage that individual workers can use as they see fit.

Given the choice between being able to rent an apartment for your family in town, or living on an isolated labor camp with five strangers in company-owned housing, what would you choose? The answer is simple, but McDonald’s latest plan doesn’t even give workers the freedom to choose.

Is one penny more per pound really too much to ask of a fast-food giant with over $40 billion per year in system-wide sales? McDonald’s approach as announced deflects the entire burden — and cost – of social responsibility onto it suppliers. Yet McDonald’s bears at least some of the responsibility for farmworkers’ poverty. Why? Because through its high volume purchases, McDonald’s has been able to extract the lowest possible prices for tomatoes from its suppliers – and in so doing exert a downward pressure on farmworker wages – for decades.

In short, McDonald’s profits from farmworker poverty, and so needs to contribute to its alleviation. Yum Brands has now clearly recognized this and is today paying a fairer price for its tomatoes so that workers who pick those tomatoes can receive a fairer wage. No new strategy for social accountability will be complete until McDonald’s recognizes its own responsibility and contributes its share to help raise farmworkers’ unconscionably low wages, too.

And for a business that moves close to $100 billion of expenses and revenues around the globe annually, it certainly couldn’t be too difficult to devise a system to trace the movement of money down its supply chain to the workers at the bottom of that chain. Indeed, money is the easiest thing to monitor – less complex by far than the byzantine compendium of non-monetary, discretionary benefits that McDonald’s will encourage its suppliers to implement, value, and monitor with this latest initiative. If simplicity is the measure, a penny per pound beats this latest idea by a mile.

There is today a human rights crisis in Florida’s tomato fields, marked by modern-day slavery, sub-poverty wages, no overtime pay, and more. News of the employment of a convicted slaver by one of McDonald’s key suppliers just last month – weeks after fanfare accompanying the SAFE initiative – only underscores that. But McDonald’s insists on responding to this human rights crisis as a public relations crisis, and these problems won’t be solved with a public relations quick fix.

The CIW is already working in a partnership towards social responsibility with YUM Brands and its Florida tomato suppliers that provides a real raise to the pickers and gives workers a real mechanism for reducing labor rights violations and improving working conditions. Genuine labor reform in McDonald’s supply chain will only begin when McDonald’s stops trying to sidestep the issues and works with the CIW to make workers not only a real part of, but a real partner in, how they do business.