Is McDonald's exploiting exchange students?

A labor group says some restaurants are abusing a popular program by effectively paying workers less than the minimum wage.

By Aimee Picchi Mar 7, 2013 2:01PM

A sign outside the fast-food chain McDonaldMcDonald's (MCD) is known for minimum-wage jobs, but a labor group says some restaurants are going even lower than that.

Students from Asia and Latin America paid as much as $3,000 each to come to the U.S. on a J-1 visa, but didn't exactly get what they thought they had paid for, the National Guestworker Alliance claims.

Instead of the cultural exchange and "good work" they expected, they became "exploited workers at McDonald's restaurants in Pennsylvania," Argentinean exchange student Jorge Rios wrote in a letter to McDonald's CEO Don Thompson. Rather than having a summer filled with enriching cultural experiences, they suffered grease burns and poor housing conditions, the letter notes.

"We could not quit because we knew that if we did, our visas would be cancelled. One manager told us, 'You better remember, all we have to do is make one phone call and we can deport you back to your country at any time,'" Rios wrote. His letter singles out McDonald's franchises near Harrisburg, Pa., where the workers held a strike on Wednesday.

The claims are reminiscent of similar complaints against another Pennsylvania company, Hershey (HSY). In that case, where workers were also championed by the National Guestworker Alliance, the chocolate maker agreed to pay $200,000 in back wages after foreign students claimed they worked under harsh conditions.

A manager at one of the McDonald's restaurants referred questions to McDonald's corporate headquarters, which didn't immediately respond to a request for comments, according to the Huffington Post

While McDonald's paid the students minimum wage of $7.25 an hour, their employer charged them $300 per month to live in crowded basement apartments, where as "many as eight of us lived in a single basement," Rios wrote. Because of what the labor group calls "exorbitant housing deductions," their pay was brought to below minimum wage. 

The J-1 Summer Work Travel Program is designed for college students to travel to the U.S. and "to live and work in the United States during their summer vacation," according to the State Department's website

While Rios wrote that he expected 40 hours of work a week, he was given as little as four hours. "The employer knew we were desperate for more hours, and he kept us on call to come in with 30 minutes' notice all day and night. I didn't even have time to visit the public library," he wrote. 

Rios and the National Guestworkers Alliance are asking that McDonald's refund the students' money, including unpaid overtime and housing overcharges, and offer full-time work to its U.S. workers, whom they claim are "struggling with too few hours." They're also asking McDonald's to reveal how many of its restaurants employ exchange students. 

"This is not the America we believed in," Rios wrote. "We believe America is a beautiful country, where everyone can have respect and fair treatment at work."

More on moneyNOW

Mar 7, 2013 3:50PM
minimum wage and 300 bucks for rent. now you are living like we do. welcome to America.
Mar 7, 2013 3:16PM
It's not just J-1 visas but also work visas.  People here need jobs, how about hiring them?
Mar 7, 2013 3:37PM

Do not expect companies like McDonalds to treat you fairly.    They participate in this program to get cheap workers.   This way also they can keep down the wages paid to Americans.

Mar 7, 2013 3:29PM
I hear you, brother. This isn't the America I heard about either. Mine's been hijacked by Mega-International Conglomerates.
Mar 7, 2013 3:39PM
This is where we're going, folks. In the coming decades it won't just be foreigners who have to deal with this.
Mar 7, 2013 3:04PM

A great way to prove to other countries that we're "The greatest Country on Earth".  Why not just chain these children to the prep tables in the restaurant at night? Why give them 'housing' at all?

Mar 7, 2013 3:13PM
Mar 7, 2013 3:17PM
What a surprise that a big American company would do something underhanded and unethical. NOT!!
Mar 7, 2013 4:19PM
Mar 7, 2013 3:43PM
Lousy food and lousy pay, what's next?
Mar 7, 2013 4:43PM

....thanks for the article. This news will indeed travel fast around the net and then onto network news. I will be waiting to hear how the corporate kroc will spin the story into a misunderstandings and that they will look into the matter...And like most if not all whistle-blowers’, Jorge Rios is now maligned with a go-back-where-you-came-from resentment from the struggling masses here. The story behind the story is the connection of the `probable’ State Department collusion with corporate deep pockets to establish and set up such a program of indentured servitude under the euphemism of an exchange student program.

Mar 7, 2013 3:48PM
Send them back home, give the jobs to Americans!!!!
Mar 7, 2013 4:25PM

Far too common of a practice in the food industry and others, and all over the country.  While "McMoms" struggle to get enough hours, and our nations teens suffer high unemployment, and pay is even CUT at times for US workers, the businesses bring in workers that they can squeeze even more from.  Don't blame McDonald's- this is a government program and even the employers who treat their imported students well are still not playing fair.  Foreign students = NO unemployment liability, NO insurance liability, etc. 

Foreign students, illegal aliens, and Annie's housekeeper, and every underemployed American and unemployed teenager (I am the mother of two), we are ALL victims. 

On the flipside, - if we were to go to McD's or anywhere else where cheap and quick is the goal, and be charged $10 for our burger, we would scream bloody murder. 

Mar 7, 2013 3:43PM




Mar 7, 2013 3:03PM
Mar 7, 2013 4:23PM
Just another reinforcement that "there is substitute for an education"! Some people get the education in the classroom while others still insist on continued Adult education classes at the "School of Hard Knocks!" I worked at MacDonalds years ago and viewed it as a great opportunity while I was seeking higher education at the local junior college. I knew that my time at MacDonalds was short lived as I had greater expectations in my life but also knew that I would never get a high paying job unless I had something of value to offer a potential employer. Sadly, those that complain about minimum wage employment opportunities have gotten themselves into dire straights in their lives and choose to blame MacDonalds and Walmart for not offering them $80,000 / year starting positions when they have high school or less education to offer in return. Go to school! School is FREE! But you have to attend classes and study the material being taught. There are no free rides in life!  
Mar 7, 2013 4:09PM
i've lived in the U.S. my whole life, and i've had one job that i wasn't treated this way.... again, i was born here. welcome to america
Mar 7, 2013 4:40PM

The government is paying for imigrants to come from other countries!!!!! That needs cut out of the budget right now.

Mar 7, 2013 3:49PM
See the late founder Ray Kroc's autobiography, "Grinding it Out", 1977.  He would turn over in his grave if McDs was paying less than the min. wage.  He knew better than to call the empire "Kroc's", right? 
Mar 7, 2013 5:06PM
I've both hired and housed J-1 students. Just like McDonald's, I paid them the same rate as American workers. J-1 students don't have the taxes taken out so their take home is more. I hired them for the summer because typically they were stronger workers than their American "student" counterparts and didn't bail the first week of August. They received plenty of hours and typically worked second and third jobs. They would spend the last two weeks in Sept. before they left traveling and sightseeing. They left with experience, admiration and a few thousand dollars. When I housed them I charged $75/week each to share a bedroom in a resort area.  I've had students from Ireland, England, France, Spain but most of them now come from Eastern Europe.Like most things in life....the experience is what you make of it. 
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