Franchise Owners Learn that Sexual Harassment Can be Costly

It was reported in January of this year that AMTCR , Inc., AMTCR Nevada, Inc., and AMTCR California, LLC (AMTCR), a Kingman, Arizona-headquartered franchise owner operating approximately 18 McDonald’s restaurants in Nevada, Arizona, and California, will pay $1,997,500 to resolve a sexual harassment lawsuit filed by the U.S. Equal Employment Opportunity Commission (EEOC).

According to the lawsuit, since at least 2017, AMTCR knew about sexual harassment and allowed it to continue, unabated, by supervisors, managers, and co-workers at several of its McDonald’s restaurants. The harassing conduct, which was mainly directed at younger employees, included frequent unwanted touching, offensive comments, unwelcome sexual advances, and intimidation. As AMTCR failed to adequately address the complaints of sexual harassment, many workers found the working conditions so intolerable that they had no choice but to quit.

Such alleged conduct violates Title VII of the Civil Rights Act of 1964, which prohibits sexual harassment in the workplace. The EEOC filed suit in U.S. District Court for Nevada, after first attempting to reach a pre-litigation settlement through its conciliation process.

“Preventing and remedying systemic harassment and protecting vulnerable workers from discrimination are key priorities for the Commission,” said EEOC Chair Charlotte A. Burrows.

“Teenage workers are especially vulnerable to harassment. The EEOC will continue to use all its tools - including outreach and education, technical assistance, and, where necessary, litigation - to tackle workplace harassment.”

In addition to the monetary relief, AMTCR has agreed to provide significant, franchise-wide injunctive relief aimed at preventing discrimination and harassment in the workplace.

AMTCR has agreed to retain an outside third-party EEO monitor who will conduct internal audits of AMTCR’s practices in handling harassment and retaliation complaints; establish a centralized tracking system for discrimination, harassment, and retaliation complaints; and ensure accountability and appropriate disciplinary action occur. AMTCR has also agreed to conduct climate surveys within the workplace, update policies and procedures regarding discrimination, harassment and retaliation, and conduct training.

Individuals who believe they were sexually harassed or otherwise discriminated against because of gender while working at AMTCR at any time during the period from January 1, 2017, - January 5, 2023, may be entitled to monetary relief by submitting a claim through the EEOC.

“We continue to see young workers entering the workforce being subjected to harassment in the workplace.

Employers should take extra care that supervisors are trained to understand their obligations and that employees are encouraged to report discrimination,” said Anna Park, regional attorney for EEOC’s Los Angeles District Office, whose jurisdiction includes Nevada and California. “We are encouraged by the robust measures AMTCR is agreeing to implement company wide to encourage workers to raise complaints; to swiftly and effectively address complaints; and to include bystander training for all employees to ensure a discrimination-free work environment.”

“Employers should be mindful of the demographics of their workforce, including whether employees may be more vulnerable to being targeted because of their age,” said Michael Mendoza, director of the EEOC’s Las Vegas Local Office. “It is the responsibility of the employer to create a safe workplace, free from discrimination and harassment.”

To learn more about sexual harassment, visit the EEOC’s website at: eeoc.gov/sexual-harassment. For more information about the Commission’s Youth at Work Initiative, visit: eeoc.gov/youthwork.