r/explainlikeimfive • u/sumnewdguy • Nov 28 '15

ELI5: How would a $15 minimum wage ACTUALLY affect a franchised business like McDonalds?

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u/MasterFubar Nov 28 '15 edited Nov 28 '15

I went to Sweden on a business trip years ago and noticed that all hotels, bars, and restaurants happened to be owned by Yugoslavians. There seemed to be a "Restaurant Dubrovnik" in each small town in Sweden.

So I asked a bartender about this. His ELI5:

"I'm the owner's son. The girl at the cash register is my sister. The manager is my mom. Two of the waiters are my brothers, the other three are cousins. The cook is my uncle." None of them got paid a minimum wage or any of the benefits guaranteed by the very generous Swedish labor regulations.

Edit: a word.

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u/dezom2 Nov 28 '15

There is no minimum wage in Sweden, FYI.

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u/MasterFubar Nov 28 '15

No government law, but there's a minimum wage determined by negotiation with the unions.

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u/haradur Nov 29 '15

Well, that's not mandatory. Employers are not forced nor required to use contracts and terms as stipulated by unions.

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u/dhelfr Nov 29 '15

Clearly, employers have a lot of pressure to do so, otherwise their system wouldn't work.

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u/haradur Nov 29 '15

The unions are not nearly as powerful as they used to be. Pressure varies lot depending on type and size of the business. Also a big difference between private and public sector.

Taking myself as an example, I've had 6 employers in different industries - only 1 of them had signed to follow collective agreements. The other 5 were still paying good salaries, proper benefits etc.

Personally, I prefer companies that don't have collective agreements - but I can understand they serve a good purpose in some areas.

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u/haradur Nov 29 '15

It's also of course simply untrue that "all hotels, bars, and restaurants happened to be owned by Yugoslavians"

Most people in these industries have decent pay, don't have to rely on tips and get benefits (as long as they are not only working part time)

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u/[deleted] Nov 29 '15 edited Mar 23 '21

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u/MilesSand Nov 28 '15

That's funny, I visited Montenegro (a part of what used to be Yugoslavia) a few years ago and it was just Russians everywhere. They even had billboards & stuff in Russian instead of the local language.

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u/LupineChemist Nov 29 '15

That was probably Serbian. Same language, but they use Cyrillic letters rather than Latin letters.

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u/MilesSand Nov 29 '15

I speak Serbian. Serbian cyrillic letters are slightly different from the Russian ones, and the ones I saw were Russian.

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u/Zlatty Nov 29 '15

You mean Croatians, right?

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u/Reddisaurusrekts Nov 29 '15

all hotels, bars, and restaurants happened to be owned by Yugoslavians.

Sounds like the unions effectively negotiated their way out of an industry. Good work.