That the Restaurant Brands International board of directors report to shareholders, at reasonable cost and omitting proprietary information, on actions the company is taking to ensure decent work practices are upheld in the company’s franchisee operations, including:
a) RBI’s minimum requirements and standards related to workforce practices (including wages and benefits, working hours and breaks, health and safety, shift scheduling and training) for
corporate offices, branded operations and franchisees;
b) RBI’s programs, activities and financial or operational arrangements to support franchisees in adopting best practices for workforce management; and
c) Systems and key performance indicators used by RBI to evaluate whether its minimum requirements and standards are being upheld in its own and franchisee operations.
There is broad consensus that good human capital management is important to the bottom line, especially in customer-facing service industries where an employee’s conduct and efficiency are critical to the customer experience. A large body of empirical studies shows that skillful management of human capital is associated with better corporate performance including lower employee turnover, higher productivity and innovation, and better risk mitigation.
The widely-publicized response by some Canadian Tim Horton’s franchisees to Ontario’s minimum wage increase in January 2018 (e.g. clawing back of other employee benefits), as well as related conflicts with Tim Horton’s franchisee operators over the past few years, and reports from Burger King and Tim Horton’s employees of on-call shift scheduling and unpaid overtime, suggest that workforce management questions are contributing to reputational problems for the Tim Horton’s brand which may affect sales.
Restaurant Brands International has noted that decisions by certain franchisees to cut employee benefits “…do not reflect the values of our brand, the views of our company or the views of the overwhelming majority of…restaurant owners” and that “…we are committed to helping them work through these changes.”1 We are requesting a report on that process.
Within a franchise operating model, the success and reputation of Restaurant Brands International’s business depends on a highly-engaged customer-facing workforce and strong franchisor-franchisee relationships. While franchisees have a direct employment relationship and related responsibilities for the workforce, RBI is responsible for providing both standards and expectations of human capital management, and the collaboration required to uphold strong workplace standards including supportive training, development, and appropriate financial arrangements.
Establishing minimum requirements and standards for RBI branded operations and franchisees to ensure decent work, and supporting franchisee capacity to provide decent work, would help RBI to ensure that its direct and franchisee workforce is protected. Ultimately, these steps would also help to ensure that the conditions are in place to deliver high levels of customer service and productivity across all RBI operations.