McDonald's Pays $33.5M To Settle Discrimination Lawsuit By Black Franchisee

McDonald’s Corporation MCD has agreed to a $33.5 million settlement in a case involving a former baseball player who accused the company of racial discrimination in allocating its franchise locations.

What Happened: Herbert Washington, a former Oakland A’s player, owned more than a dozen McDonald’s restaurants in Ohio and Pennsylvania.

Washington, who is Black, filed a lawsuit against the company in February claiming McDonald’s restricted him to low-volume locations in predominantly Black neighborhoods, then forced him to downsize after grading his locations unfairly.

According to an Associated Press report, McDonald's said the settlement being paid to Washington for his 13 franchises was “no more than what we deem a fair price for the value of the restaurants.” The company was not required to admit wrongdoing in its settlement.

“While we were confident in the strength of our case, this resolution aligns with McDonald’s values and enables us to continue focusing on our commitments to the communities that we serve,” the company said in a statement, adding that “discrimination has no place at McDonald’s.”

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What Else Happened: Shortly after Washington’s lawsuit was filed in February, McDonald’s announced a new push for diversity and inclusion in its ranks. In a corporate blog post titled “Allyship Through Accountability,” the restaurant chain stated the mission to “increase representation of historically underrepresented groups in leadership roles (senior director and above)” to 35% by 2025; as of 2020, McDonald’s found these demographics accounted for 29% of leadership roles.

The company also stated it would increase the representation of women in leadership roles globally to 45% within four years; as of 2020, women make up 37% of McDonald’s global leadership positions.

Washington’s case was the second discrimination lawsuit that McDonald’s faced in court this month. On Dec. 1, a federal judge dismissed a $10 billion lawsuit against the company by media entrepreneur Byron Allen, who charged McDonald’s with discrimination for not advertising with Black-owned media.

Photo: Mike Mozart / Flickr Creative Commons