In preparation for sending out online layoff notices to a large number of their U.S. workers, McDonald’s has briefly closed all of its U.S. offices. The Wall Street Journal reports that as part of a business restructuring, layoffs will commence on Monday, after workers were assured they could work from home.
According to an internal McDonald’s document, “key decisions related to roles and staffing levels will be communicated across the organization during the week of April 3.” The business claims that it practically decided to disclose layoffs due to an expected busy travel week. Although CEO Chris Kempczinski warned of “difficult discussions and decisions ahead” in a January email, the exact number of layoffs is currently unknown. According to an article published by the Wall Street Journal on Wednesday, workers at the Chicago-based company were informed via a private email sent the previous week.
The majority of the recipients were located in the United States, but the message also reached some foreign company staff. Executives also requested that any forthcoming in-person meetings with suppliers and other outside parties be postponed in the company’s offices. An upcoming hectic travel week, possibly related to the Easter holiday, prompted the decision to allow workers to work virtually at least part of the week. The staff was instructed to provide their boss with their personal contact information if they did not have access to a computer. The business stressed that it cares about its employees’ privacy and well-being during the communication process.
About 200,000 employees are employed by McDonald’s in various corporate positions and company-owned restaurants around the globe. Seventy-five percent of workers are based in countries other than the United States. DailyMail.com has reached out to McDonald’s for clarification on the cutbacks and an expected number of employment losses, but has not yet received a response. Kempczinski emailed employees in January explaining how layoffs across the company would contribute to growth.
The CEO wrote a note to employees expressing concern that the business had lost its direction. It was written that “70 different, distinct versions of what a crispy chicken sandwich would look like” existed around the world. “I don’t need 70 ways to slice a chicken sandwich,” he said. The Chicago-based burger chain employs over two million people to run its franchised 40,000 locations in over 160 nations. Of those, about 13,000 are found in the United States.
Also included in the message was this gem from the CEO: “Today, we’re divided into silos with a center, segments, and markets.” The January memorandum was captioned “Accelerating the Arches 2.0.” In an interview, he explained that he wasn’t shooting for any particular savings goal with the layoffs but rather was just trying to move the company forward.
Kempczinski predicted that “some existing jobs that exist today will either be relocated or those jobs may disappear.” Corporate employees have been laid off before by the business. To become “more dynamic, nimble, and competitive,” McDonald’s had to lay off management in 2018.
In spite of Kempczinksi’s efforts to reduce expenses and boost McDonald’s earnings, the fast food giant’s prices have leveled off in recent months due to historically high inflation. Customers who wanted quick and inexpensive meals helped the business keep its profit margins.
In October, McDonald’s CFO Ian Borden said, “We’re gaining share right now among low-income consumers.” In January, CEO Kempczinski said the firm was still doing well serving low-income consumers, albeit with smaller orders of cheaper goods.