Federal labor officials say the McDonald’s franchise that controls 12 restaurants in metro New Orleans violated child labor laws and has hired more than 80 minors in two states.
Federal labor officials say the McDonald’s franchise that controls 12 restaurants in metro New Orleans violated child labor laws and has hired more than 80 minors in two states.
I ran some basic calculations:
I assumed that the child workers are making minimum wage, the adult workers are making $10 per hour (pay seems to be between $9.27-11.05 per hour), each shift has three people (two of which are child workers), and this is occurring during the summer when school is out.
Using this I figured that if the store was run by 3 adults, each working 12 hour shifts (4 hours of OT), then paying the employees would cost $960 per day per franchise [2(3((8x10)+(4x20))) = 960]. For a store that employs 2 children and one adult per shift and doesn’t pay OT for the children the savings per day is about $292 per location [2(160) + 4(12x7.25) = 668, 960 - 668 = 292]. If they did pay OT to the children then the difference would be $176 [2(160) + ((8x7.25)+4(14.50)) = 784, 960 - 784 = 176]. So if we take these savings and multiply them across the 12 locations and then multiply that daily savings across the entire franchise by the amount of weeks off in the summer ≈ 11 then you get a total franchise savings of either $38,544 [292x12x11] without OT) or $23,232 [176x12x11] (with OT). All it takes is for them to do this for two summers and the fine becomes irrelevant. Not to mention that this doesn’t even count child labor usage during off school times.
You’re not considering the lost revenue from not filling those positions at all which is a lot more money. There’s a big shortage for positions that pay peanuts and they likely wouldn’t have been able to hire/get more hours out of adults at the same pay rate.