Human Resources - Case study

Question 1

Outline the strategic role of human resources in McDonald’s

Answer 1

• worldwide, McDonald’s directly employs approximately 150,000 people.Including those employed by franchisees, there are over 2 million people who work for McDonald’s
• McDonald’s has a policy called Global Brand Standards which applies to all staff.This sets out the standards and expectations the business has of employees. In 2021, it also launched Building a Safe, Respectful and Inclusive Workplace

Question 2

Outline the role of outsourcing in McDonald’s human resource management

Answer 2

• SafetyWorks: SafetyWorks helps McDonald’s comply with workplace health and safety requirements. This is important because it ensures all stores are better equipped to meet legal mandates and safe work practices
• Sonder: In late 2023, McDonald’s Australia struck a deal with Sonder to give all employees access to its health, safety and well-being platform
• Paradox: Paradox is a recruiting platform that runs McHire. This system uses conversational AI to engage with prospective candidates.

Question 3

Provide examples of stakeholders that are key influences of McDonald’s human resource management

Answer 3

• employers: McDonald’s is a significant employer in Australia, accounting for around 7% of all restaurant and cafe workers and spending AU$1.5 billion annually on wages
• employees: McDonald’s has over 2 million employees worldwide, with about 115,000 of these in Australia. 70% of crew are either secondary, TAFE or university students
• government: Fair Work Ombudsman and Fair Work Commission e.g. In December, the FWC made a ruling that all McDonald’s employees be paid under the national Fast Food Industry Award
• society: McDonald’s has a Responsible Student Employment Policy, which restricts the hours school students are allowed to work

Question 4

Provide examples of the employment contract in legal influences on McDonald’s human resource management

Answer 4

• for many years, employees at McDonald’s in Australia worked under the McDonald ’s Australia Enterprise Agreement 2013. In December 2019 the FWC ruled that all employees of McDonald’s be employed under the Fast Food Industry Award
• In 2019, a Brisbane manager told workers who wanted rest breaks they were banned from toilets and drinking water. The RAFFWU union launched legal action and the owner was fined $82000
• it is claimed that managers and supervisors were expected to arrive early and stay back at work unpaid, representing an estimated AU$100 million in unpaid wages

Question 5

Describe how technological influences impact McDonald’s human resource management

Answer 5

• all McDonald’s employees use Metime, an online platform that is used for such things as rostering, pay and training
• McDonald’s has been rolling out self-service kiosks and mobile ordering apps that remove the need for the customer to interact directly with an employee to place an order
• In June 2022, McDonald’s signed a deal with Meta (owner of Facebook) to use its Workplace platform. McDonald’s can engage employees via their phones. It can also establish a stronger sense of community amongst the workforce. Changing roles for staff McDonald’s uses the Workplace platform

Question 6

Describe how social influences impact McDonald’s human resource management

Answer 6

• McDonald’s Australia allows employees to start work earlier or finish later from Monday to Thursday to allow a 1pm finish on Fridays. It offers eighteen weeks paid parental leave for company employees, and for parents returning to work, it offers discounted child care and designated breast-feeding rooms
• A new law, AB 1228, will come into effect on April 1, 2024, in California, USA, which will set the minimum wage for fast-food employees at US$20 per hour
• In the US, a major campaign called Fight for $15 has been arguing for the minimum wage for low-paid workers, including those at McDonald’s, to be set at US$15 per hour

Question 7

Describe the influences of ethics and corporate social responsibility on McDonald’s human resource management

Answer 7

• young casuals: McDonald’s Australia employs approximately 71% of staff on a casual basis. McDonald’s Australia has a Responsible Student Employment Policy. This “ensures that young full time students will usually work no more than two shifts per week during term time and in the case of students 17 years of age or younger they will not work beyond 11pm or before 5am on a school day”
• people with disabilities: In Australia, McDonald’s has a partnership with Omnia Inclusive Employment who run a program called Golden Opportunities

Question 8

Outline the process of acquisition in McDonald’s human resource management

Answer 8

• McDonald’s United States uses a centralised approach to staff acquisition. Potential applicants must submit details through one central website
• Many stores take advantage of the McHire recruiting platform, a one-stop-shop for gathering preliminary information about potential employees. This also involves a specially developed artificial intelligence tool that asks candidates several questions

Question 9

Outline the process of development in McDonald’s human resource management

Answer 9

• McDonald’s Australia spends AU$60 million annually on training, showing that it takes workforce development seriously
• McDonald’s Australia is a Registered Training Organisation (RTO) with 40 trainers and assessors
• McDonald’s also has a program called Archways to Opportunity where it either runs or pays some of the cost towards education, from basic English training to high school diplomas and college degrees
• Another facility that McDonald’s uses to develop employees is Hamburger University, which has eight campuses around the world. Since its inception in 1961, it has trained more than 350,000 employees and franchisees worldwide

Question 10

Outline the process of maintenance in McDonald’s human resource management

Answer 10

• Australian employees can access a similar program called myBENEFITS -which offers discounts with over 350 retailers. Educational assistance is also offered
• McDonald’s Australia also regularly surveys its staff to identify and address potential issues, ensuring that it can effectively manage these. For example, twice a year, via the Metime portal, employees complete a short survey of 12 questions

Question 11

Outline the process of separation in McDonald’s human resource management

Answer 11

• McDonald’s has a significantly higher annual staff turnover than many other companies
• McDonald’s Australia reported that its annual staff turnover rate is 42% for crew and 20% for management
• in April 2023, McDonald’s dismissed hundreds of corporate staff within a week. To facilitate this, corporate staff were asked to work from home

Question 12

Outline leadership style in McDonald’s strategies in human resource management

Answer 12

• As McDonald’s has nearly 42,000 stores worldwide and operates using strict business guidelines, it follows that the management of the corporation might be viewed as somewhat autocratic
• McDonald’s has a very structured hierarchy, starting with a crew member all the way up to store manager and consultant. This sets a defined chain of command through the local store, consistent with autocratic leadership. This leadership strategy allows for consistency and uniformity

Question 13

Outline recruitment in McDonald’s strategies in human resource management

Answer 13

• most McDonald’s employees start as crew members and are recruited externally. A central application process makes the recruitment process efficient and streamlined for local managers, and consistent online screening of applicants can help ensure that new recruits fit McDonald’s requirements for an employee
• most management positions both at the local store and at corporate headquarters are filled internally via the promotion of existing employees
• employees also complete training through McDonald’s RTO in courses relevant to their positions

Question 14

Outline training and development in McDonald’s strategies in human resource management

Answer 14

• before being offered the opportunity to purchase a store, potential franchisees must undergo extensive training and development. In Australia, the minimum time for this is nine months full-time, during which trainees are unpaid
• as a RTO, McDonald’s Australia delivers recognised in-house training to employees, up to the level of Advanced Diploma
• McDonald’s employees from all over the world also have the opportunity to attend intensive training at Hamburger University

Question 15

Outline rewards in McDonald’s strategies in human resource management

Answer 15

• McDonald’s offers a range of rewards for staff members. These include discounted food and beverage prices (up to 50%), promotions, group and individual performance pay and awards and prizes
• McDonald’s corporate employees may be eligible for company cars, healthcare services, discounted child care, fitness memberships and flexible work arrangements.
• In the United States, McDonald’s have a dedicated website detailing staff achievements

Question 16

Outline indicators for the effectiveness of McDonald’s human resource management

Answer 16

• 5% of Australia’s population has at one time worked for McDonald’s. 1 in 8 Americans also have.
• 95% of current and previous employees in Australia believe working at McDonald’s actually helped them succeed in life
• more than 4 in 5 employees feel they’re receiving not only the training they need to fulfil their day-to-day roles, but also training that equips them for a career
• In 2018, 2019, 2020 and 2021, McDonald’s Australia was selected as an Employer of Choice in the Australian Business Awards