Corporate-Owned McDonald’s Will Only Offer Drive-Thru, Takeout, and Delivery Amid Coronavirus Pandemic

Over the past week, in response to the COVID-19 pandemic, plenty of restaurant operators have taken it upon themselves to close their restaurants or pivot to takeout and delivery, even in areas where the local government hasn’t officially ordered a closure. Today, McDonald’s is becoming the biggest restaurant operator to take that step, closing its restaurants while continue to offer drive-thru and delivery service. There is a catch: this is only for its company-owned stores, which make up less than 20 percent of all McDonald’s locations.

In a statement, McDonald’s says its making the move “to align with increasing regulations throughout the country,” and that it will be shutting seating areas and self-service stations at company-owned locations. The company notes “franchisees are strongly encouraged to adopt similar operations procedures while keeping the needs of their people and communities at the center of their decisions. This guidance is supported by franchisee leadership and is expected to be adopted by the majority of franchisees.”

Mark Salebra, chair of the National Franchisee Leadership Alliance, says “Franchisee leadership completely supports the decision to adhere to social distancing guidelines and ensure that large groups of customers are not gathered together inside our restaurants.” However, as independently-owned restaurants, franchises outside of the 10 states that have demanded restaurant dining room closures may remain open if their operators so choose.

The divide between company-owned and franchised stores is also an issue when it comes to McDonald’s paid sick leave plan. The company is providing up to 14 days of paid sick leave for employees who have been exposed to COVID-19 and are under quarantine, but again, it only applies to company-owned stores. McDonald’s has encouraged franchisees to do the same, but cannot compel them to change policies as long as they adhere to state and local laws. This division between corporate and franchises is also a big reason why it’s hard for fast food workers to unionize — Trump’s “joint employer” rule means the federal government considers the franchise owner the employer, not McDonald’s, so employees at different franchises have a harder time arguing that they work for the same company.

Still, this move by McDonald’s could have a huge impact on how fast food responds to COVID-19. In a statement, Taco Bell CEO Mark King said the company is “equipping our restaurants to serve our guests via drive-thru and delivery only where necessary,” but has not yet made the move to close dining rooms. And so far, no other national chain has preemptively shut dining rooms where the government hasn’t required it. “McDonald’s is an iconic brand that has the ability to have a significant impact on how we as Americans can uniquely address this pandemic,” Dr. Ben Lawrence, Aziz Hashim Professor of Franchise Entrepreneurship at Georgia State University, tells Eater.

Franchisees are independent owners who “need the support of their franchisors as they struggle” says Dr. Lawrence, but they are in a better position to get it than independent restaurants with no corporate connection. McDonald’s is one of the few restaurants that may be able to weather the coronavirus storm without much help. And if restaurants don’t get the bailout they need, McDonald’s may be what’s left.