McDonald’s Restructuring Includes Pay Cuts, Closed Offices and Layoffs

McDonalds Restructuring

Some Corporate Employees Were Offered Reduced Compensation, Including Changes to Titles and Benefits

McDonald’s corporate restructuring has resulted in hundreds of layoffs as well as decreased compensation for some employees, according to an April 7 report by The Wall Street Journal. American and foreign employees of the fast-food giant have been hit by the shake-up that occurred at corporate headquarters in Chicago as well as at its field offices. Affected departments were wide-ranging and included operations and marketing, sources told The Journal. 

In the lead-up to the restructuring, McDonald’s had temporarily closed its U.S. offices – having employees work from home –  and began laying off corporate workers virtually on Monday, April 3. The company said some employees were given the option of remaining if they accepted pay cuts, changes to their titles, and reduced “benefits such as bonuses and equity grants,” according to The Journal. 

Among those getting the ax were longtime senior employees; others had worked for McDonald’s for only a few years. Some wrote goodbye messages to restaurant operators and co-workers. A director who had worked at McDonald’s for 20-plus years announced his exit with a haiku on LinkedIn that concluded with, “This is not good-bye – But a ‘see you later’ note – I’m cheering for you.”

Details about McDonald’s Restructuring 

The Journal quoted Joe Erlinger, president of McDonald’s USA, as saying in an internal company email on Thursday that “while the McDonald’s brand is in the strongest position it has been in years, we also recognize that our business has grown increasingly complex in recent years.” 

McDonald’s restructuring altered roles for certain staffers and even meant promotions for some, nearly 10 of them U.S. officers who were working across operations, finance and marketing, the Thursday email stated. That email also told U.S. restaurant owners and operators that the restaurant chain would close its brick-and-mortar field offices in coming months because most field staff members spend work hours in restaurants and not in the offices, rendering them underused. A single national office will instead manage the 10 field operations. 

The laid-off employees have officially left the company but will be paid through June 15. After that they can receive severance, one source disclosed to The Journal. Affected employees with company cars have the option of returning the vehicles in June or buying them, the person said.

McDonald’s Layoffs Announced in January

In early January of this year, McDonald’s CEO Chris Kempczinski announced the upcoming staff reductions and said they would save money. But Kempczinski said he hadn’t set a dollar target for savings or a total number of jobs that would be eliminated. The personnel changes would affect projects that are already underway, he said; McDonald’s would consolidate some projects and drop others as it streamlined to operate more nimbly.

Before these layoffs, McDonald’s employed more than 150,000 people worldwide in corporate roles and in its company-owned restaurants, with 70% of them located outside the United States. More than 10,000 McDonald’s restaurants are franchisee-owned.

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Mary Vinnedge is an award-winning writer who has served as editor in chief, managing editor and senior editor at national and regional publications, including SUCCESS and Design NJ magazines. A seasoned journalist, Mary covers the latest industry news in her role as staff writer for FranchiseWire.
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