Posts Tagged ‘money’

Justin Bieber just lost 3.5 million Instagram followers

In Uncategorized on December 20, 2014 at 12:36 am

Instagram wipes out fake followers 

Justin Bieber has been left behind by the Instagram Rapture.

The “Baby” crooner lost a whopping 3.5 million followers after Instagram purged all the spam and deadweight from its site this week. Fake accounts comprised nearly 15% of Bieber’s Instagram following.

Instagram went after spam in a major way this week, deleting millions of fake accounts in what has become dubbed the “Instagram Rapture.”

It turns out that the celebrities on the Internet are not as famous as we thought. Some of the biggest names in show business shed the largest numbers of fake followers on Instagram, with the Bieb leading the way, according to data compiled by Zach Allia, a software developer.

Ariana Grande — you’ve heard of her — lost 1.5 million followers, or 7% of her total. Kim Kardashian barely qualifies as being famous anymore, after Instagram shed all her fake bits, losing 1.3 million followers, or 5.5% of her total.

Related: ‘The Interview’ was supposed to bring in $100 million

Rihanna, perhaps better known as badgirlriri, also lost a ton of fake weight, shedding more than 1.1 million followers, or 8% of her total following on Instagram. Taylor Swift fared better than a lot of her fellow celebs, losing a mere 725,000, or 4.4%. And Selena Gomez, the Bieb’s on-again, off-again girlfriend, lost 1.1 million Instagram followers, shedding 5.7% of her weight.

bieber instagram
Justin Bieber lost his shirt – and about 3.5 million fake followers – in the Instagram Rapture.

While the Bieb was hard hit, Instagram itself was the biggest loser, shedding more than 18.8 million followers, or nearly 30% of its total, in the culling.

The social media site, owned by Facebook (FB, Tech30), announced last week that it has 300 million users — not including all the spam it eliminated.

Celebrities use to promote their brands and advertise sponsors that endorse them. Accounts with large numbers of followers can score big bucks from advertisers.

Related: Antique guns up for auction

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The heart of the Internet has been hacked

In Uncategorized on December 20, 2014 at 12:36 am

Visualize the whole Internet with an app 

The all-powerful but little-known organization that administers all global website domain names has been hacked.

Um, embarrassing much?

The nonprofit group — called the Internet Corporation for Assigned Names and Numbers (ICANN) — revealed the hack in a website post earlier this week, saying the intrusion began in November.

However, the damage in this case seems to be limited.

The organization confirmed that a key department, which is in charge of ensuring the global Internet network runs smoothly, was not affected.

According to ICANN, the hackers got into the system using “spear phishing,” which involved sending targeted emails to ICANN staff that appeared to be internal messages. This allowed the attackers to access the email system and other public and internal networks.

It seems the key area that was compromised was an online site where people could request information about domain names. ICANN says hackers were able to see all user names, addresses, emails, phone numbers and passwords, though the passwords were encrypted.

“ICANN is providing notices to the … users whose personal information may have been compromised,” the organization said, though it didn’t say how many people were affected.

ICANN says the attack could have been worse if it weren’t for some new security upgrades that had been put in place this year.

“We believe these [security] enhancements helped limit the unauthorized access obtained in the attack,” it said. “Since discovering the attack, we have implemented additional security measures.”

This is the latest in a string of powerful people and organizations that have been hit by hackers this year, including Sony (SNE) and Home Depot (HD).

Related: Everything you need to know about the Sony mega-hack

Related: ‘The Interview’ was expected to bring in $100 million for Sony

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Why North Korea’s attack should leave every company scared stiff

In Uncategorized on December 20, 2014 at 12:36 am

Fmr. Sony security consultant on hack 

Watch your back, Corporate America, or you could become the next Sony.

The attack on Sony (SNE) Pictures inflicted crippling damage in a way that past hacks have not. Stolen corporate secrets, customer passwords and credit card numbers from previous cyberattacks haven’t left a lasting impact on companies, and they haven’t kept their customers away.

By succeeding in its mission to get Sony to pull “The Interview,” hackers have provided a blueprint for really hurting American companies: Break into their computers, steal data, erase files, expose private documents, then make a physical threat.

“The problem now is not the hack. It’s how Sony responded to it. It’s the cave-in,” said Peter W. Singer, a renowned author of several books on cyberwar. “They rewarded and incentivized attacks on the rest of us.”

President Obama addressed the intimidation of Sony — and its decision to pull the movie — at a press conference Friday.

“I think they made a mistake,” Obama said. “We cannot have a society in which some dictator someplace can start imposing censorship here in the United States.”

North Korea sponsored the attack on Sony, the FBI said in an unprecedented claim on Friday. Unlike most attacks conducted by Russian and Chinese hackers, North Korea’s hackers were relentless. They completely embarrassed Sony and made movie theaters afraid to carry its film.

In the past, most U.S. corporations have brushed off cyberattacks levied against themselves or their peers. That means most are just as unprepared for hackers as Sony was.

After seeing what happened to Sony, companies should be shaking in their boots.

“This sort of attack could be reproduced using the same techniques,” said Orla Cox, director of security response at Symantec (SYMC, Tech30). “This should be a wake up call for organizations,”

Sony’s attack was frightfully easy to pull off. This could have been the work of a tiny team of bright computer programmers — maybe as small as three people, said Kaspersky Lab security researcher Roel Schouwenberg. In fact, the whole operation could have been outsourced to hackers-for-hire, noted Art Gilliland, general manager of security for HP (HPQ, Tech30).

Now, companies must make a calculated decision every time it gets aggressive with a competitor or makes a controversial move. Hackers could be lurking to take them down.

“Media, pharmaceutical, energy companies. Everybody’s got enemies,” said Craig Carpenter, president of Resolution1 Security. “This Sony hack shows you can be brought to your knees if you’re not capable of shutting something like this down before it gets out of hand.”

Sony pulls 'The Interview' release  

But stopping cyberattacks takes a big investment — one that companies so far have been unwilling to make.

The barrage of cyberattacks is nonstop. Computer alarms go off maybe 5,000 times a day at a large company like Sony, Carpenter said. Every time an employee visits a sketchy website or a new app enters the network, an alarm goes off. In many cases, those must be manually checked by a member of the company’s security team.

The workload outpaces the number of workers assigned to keep companies safe. That’s how hackers slip in unnoticed and start their work. On average, it takes a company 243 days to discover a breach, according to the M-Trends 2013 report by Mandiant, a computer security consultant.

Once upon a time, companies only had to worry about cybercriminals trying to steal credit cards or foreign government spies seeking company secrets to assist competitors.

Now, the list of worries could include the Islamic State — or any other small, determined group who thinks they’ve been offended.

“Who should companies fear? Anyone that wants to do harm to a corporation,” said Lee Weiner, an executive at Rapid7. “It’s very hard to define who that could be. Are they hacktivists? Cybercriminals? Chaotic actors? It’s hard to quantify that today.”

How a balloon drop over North Korea works 

Related: Activists plan to drop ‘Interview’ DVDs in North Korea

Related: Movies are the least of Sony’s problems

Related: How safe are you? CNN’s cybersecurity magazine

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All I want for Christmas: Boobs

In Uncategorized on December 20, 2014 at 12:36 am
plastic surgery Christmas
A new Christmas tradition: Plastic surgery.

On the first day of Christmas, my true love gave to me … two breast implants, a tummy tuck and a rhinoplasty.

That may be a riff on the original, but it’s a tune many are singing this holiday season, as more people are asking Santa to go under the knife.

Holiday gift giving has become a staple at many cosmetic surgery practices, and the popularity has grown over the last several years, according to Tom Seery, Founder and CEO of, a consumer website for patients considering cosmetic procedures.

Seery said that people are widely more accepting of nips and tucks than they used to be, and the fact that it’s become more mainstream makes people more comfortable admitting they want something done.

According to the American Society of Plastic Surgeons, 15.1 million people had cosmetic procedures in the U.S. in 2013, up 104% from 2000.

“Because of that, cosmetic surgery is much less of an awkward conversation to have around the dinner table,”Seery said.

The most common plastic surgery gifts to give are anything involving the face — from fillers to lifts — and breast augmentations, according to Dr. Yoel Shahar, a plastic surgeon in New York.

The Christmas season is the busiest time of year for most plastic surgeons, because people have time off to get the procedures and then recover.

Related: Why so many men are obsessed with ‘Bro-tox’

This year, Heidi, a mother of three living on Long Island, NY, won’t be looking for the jewelry box her husband usually leaves under the tree. Instead, she’s getting a new kind of gift — money toward the facial filler Juvederm, which she’ll have injected into the area under her eyes at Marotta Facial Plastic Surgery Center.

“I was so excited when he told me, because I’m always complaining that I look so tired and my husband knows this,” said Heidi, who requested that we not use her last name.

Cosmetic surgery is a major splurge, so it’s an obvious choice for a gift wish list. The average cost of breast augmentation surgery was $3,678 in 2013, according to the American Society of Plastic Surgeons. The average face lift cost was $6,556 and a tummy tuck was $5,217.

As in Heidi’s case, the majority of these gifts come from a significant other. A survey of RealSelf community members found that, of those who had gotten some kind of a procedure as a gift, 75% received it from their romantic partner or spouse.

But this gift idea comes with a caveat: About one third of respondents said they’d be offended if a family member, romantic partner or a friend gifted them a cosmetic procedure.

It could sound downright Grinch-like to give a gift that implies your loved one could use some work, but doctors say that’s not generally the case.

Dr. Scot Glasberg, a private practice plastic surgeon based in New York City, and president of the American Society of Plastic Surgeons, said he sees procedures being gifted all the time, but usually the patient has already had a consultation and has independently decided to have work done. The third party is only involved in the payment part, not the decision to do it.

Glasberg recently met with a patient that had come to him solo for a breast augmentation. But the check came from her boyfriend, who paid for the procedure as a Hanukkah gift.

“There are a lot of red flags as a surgeon, once you hear the word gift,” he said. “The key is to make sure they’re getting it for the right reasons — to help with body image or self-esteem, not as a way to enhance a relationship.”

Related: Mall Santa 101: The making of the perfect Mr. Claus

Heidi thought her husband’s gesture meant he had been listening to all her complaining and had gotten her what she really wanted.

“I thought it was very thoughtful that he cared that much, and you know, happy wife, happy life.”

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Hackers to Sony: We’ll stand down if you never release the movie

In Uncategorized on December 20, 2014 at 12:36 am

Hackers claim they're done if film never airs 

The hackers behind a devastating cyberattack at Sony Pictures have sent a new message to executives at the company, crediting them for a “very wise” decision to cancel the Christmas day release of “The Interview,” a source close to the company told CNN.

The email message was received by Sony’s top executives on Thursday night and was obtained by CNN.

The source said that the company believes the email was from the hackers because it followed a pattern of previous messages, sent to a list of particular executives and formatted in a particular way.

A Sony spokesman declined to comment.

Also on Friday, President Obama said he disagreed with Sony’s decision.

“I am sympathetic to the concerns that they face. Having said all that, yes I think they made a mistake,” Obama said at a White House press conference.

“We cannot have a society where some dictator someplace can impose censorship here in the U.S.,” he added.

Obama: Sony made a 'mistake' 

Related: FBI: North Korea responsible for Sony hack

The FBI has officially linked the cyberattack at Sony to the North Korean government.

“The destructive nature of this attack, coupled with its coercive nature, sets it apart,” the FBI said in a statement.

The Motion Picture Association of America called the hack a “despicable, criminal act” on Friday.

“This situation is larger than a movie’s release or the contents of someone’s private emails,” said Chris Dodd, CEO of the lobbying group. “This is about the fact that criminals were able to hack in and steal what has now been identified as many times the volume of all of the printed material in the Library of Congress.”

The hacker message is effectively a victory lap, telling the studio, “Now we want you never let the movie released, distributed or leaked in any form of, for instance, DVD or piracy.”

The message also says, “And we want everything related to the movie, including its trailers, as well as its full version down from any website hosting them immediately.”

It warns the studio executives that “we still have your private and sensitive data” and claims that they will “ensure the security of your data unless you make additional trouble.”

The email was titled “Message from GOP.” The anonymous hackers have called themselves “Guardians of Peace.”

Sony is still reeling from the late November cyberattack that crippled its computer systems, and now it is under severe scrutiny for canceling the Christmas release of “The Interview,” Seth Rogen and James Franco’s comedy about an attempted assassination of North Korean leader Kim Jong-un.

U.S. officials now believe North Korea instigated the hack, lending credence to the Sony executives who privately started calling it a “terrorist act” weeks ago.

Since the cancellation on Wednesday, the same executives have been wondering whether the leaks of private emails and corporate documents would now stop.

Thursday night’s message implied that the leaks will stop.

In a statement on Wednesday when the film’s release was scrapped, the company said “we stand by our filmmakers and their right to free expression and are extremely disappointed by this outcome.”

Many lashed out at the studio for its unprecedented decision to pull the movie. Others have rallied around Sony’s predicament.

George Clooney, in an interview with on Thursday, revealed that he had circulated a petition earlier in the week saying “we fully support Sony’s decision not to submit to these hackers’ demands” — but no one was willing to sign it.

“It was a large number of people. It was sent to basically the heads of every place,” Clooney said without naming names.

The petition said, “This is not just an attack on Sony. It involves every studio, every network, every business and every individual in this country,” and it concluded, “We hope these hackers are brought to justice but until they are, we will not stand in fear. We will stand together.”

It’s outdated now, since Sony did cancel “The Interview.” In the interview, Clooney expressed sadness that “as we watched one group be completely vilified, nobody stood up.”

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How to pick the best dividend stocks

In Uncategorized on December 20, 2014 at 12:36 am
Disney Christmas
Disney recently announced a 34% dividend increase for 2014.

Investing in dividend stocks can be a powerful and effective strategy to obtain superior returns over time.

However, there is much more to successful dividend investing that simply going after companies with big yields. Disney (DIS), Starbucks (SBUX), and TJX (TJX) (parent company of T.J. Maxx) show that investing in businesses with increasing dividends and healthy fundamentals can be the key to outperforming the markets in the long term.

The importance of dividend growth: According data from Goldman Sachs, dividend stocks tend to outperform their nondividend-paying counterparts by a considerable margin over time. A $10,000 investment in nondividend stocks in 1972 would have turned into $26,417 by 2013, while investing the same amount in dividend-paying stocks would have resulted in $413,073.

That staggering difference provides solid evidence in favor of dividend investing. However, that’s only part of the story: Results tend to be even better when investing in companies with consistent dividend growth. A $10,000 position in companies raising their dividends on an annual basis or starting new dividend payments would have turned into an even larger $559,702 by the end of the period under study.

Related: Don’t Worry About the Drop in Oil Prices, Worry About This Instead

Dividends don’t only provide income to investors, they also say a lot about a company’s fundamentals and financial strength. Sustainable dividend growth demonstrates the business is producing increasing sales and expanding cash flow, and this is can be a powerful return driver over time.

In addition to paying attention to dividend growth, it’s important to understand the fundamentals and competitive strengths behind those payouts to make sure the business can sustain increasing dividend distributions over time.

1. Disney

Disney recently announced a 34% dividend increase for 2014. What started as an annual distribution of $0.39 per share in 2009 has grown to $1.15 per share. The House of Mouse has reported record sales and earnings over the last four consecutive years, and management is optimistic regarding growth prospects in the middle term.

Disney owns tremendously valuable competitive assets in its brand and intellectual properties, and the company is proving its ability to translate those strengths into growing dividends for shareholders. The movie pipeline is full of promising launches, including the next Star Wars movie, “The Force Awakens,” which is scheduled for release in December 2015.

Related: Warren Buffett Tells You How to Turn $40 Into $10 Million

The payout ratio is comfortably low, under 25% of average earnings estimates for the coming year. This means Disney offers substantial room for dividend growth, especially if the company continues leveraging its unique assets to produce rising sales and earnings in the years ahead.

2. Starbucks

Starbucks is one of the most remarkable growth stories in the consumer sector over the last several years, as the company has built a gigantic global coffee emporium with more than 21,300 stores. Even better, management intends to generate $30 billion in sales by fiscal 2019, almost doubling the $16 billion in revenue produced in fiscal 2014.

Growth plans are clearly ambitious, but Starbucks is benefiting from multiple growth engines and management has proven its ability to capitalize on opportunities in a profitable way. Store base growth, more drink and food offerings, lunch and evening day-part expansion, and mobile payments and delivery are some of the growth venues the company is planning to lever to achieve its targets.

Related: Starbucks has decades of growth ahead

Starbucks started distributing regular dividends in 2010, and the company has raised payments from $0.10 per share quarterly to a much hotter $0.32; this includes a caffeinated dividend hike of 23% for 2014. The payout ratio is also quite safe, in the neighborhood of 40% of earnings forecasts for fiscal 2015.

3. TJX Companies

Fashion is a fickle and competitive industry, but TJX’s smart and differentiated business model has allowed the company to generate consistent financial performance over time. The off-price retailer of apparel and home fashions has delivered growing comparable-store sales over the last 23 consecutive quarters, an impressive track record in such a challenging business.

TJX sources products from more than 16,000 vendors in over 75 countries. The company provides department stores the opportunity to clear excess inventory under favorable conditions; this gives TJX significant bargaining power with suppliers, which it translates into discounts of between 20% and 60% versus traditional retail prices.

These bargains resonate with customers through good and bad economic times, which has allowed TJX to deliver extraordinary dividend growth over the years: the company has grown its dividend an average rate of 23% per year through the last 18 years. The payout ratio is also comfortably low, under 20% of earnings forecasts for the next fiscal year.

When picking the best dividend stocks, investors need to look beyond yields, as companies with rapidly growing payouts and strong fundamentals can be particularly profitable investments. Companies such as Disney, Starbucks, and TJX are well positioned to continue delivering substantial dividend growth over time, which says a lot about the potential returns for these companies’ investors over the long term.

Andrés Cardenal is an investor who writes for The Motley Fool.

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It’s time for disruptive tech firms to grow up

In Uncategorized on December 20, 2014 at 12:36 am

Airbnb runs into legal trouble 

As the adage goes, there is no such thing as bad publicity.

And for today’s disruptive start-ups, critical media coverage is often worn as a badge of honor.

It means that, as a relative newcomer, you’re making an impact. And it can be seen as vindication of a desire to shake things up, setting you apart from the established businesses you want to take on.

Such publicity can also raise awareness, saving huge sums of marketing dollars.

Uber is a great example. Its business model may be revolutionary but it’s unlikely the firm would have captured global attention as quickly as it has without the stream of “bad news” stories.

Likewise, when city officials around the world declare war on Airbnb, people want to know what the fuss is about. They visit the website, and may even be tempted to make their first foray into the world of alternative accommodation.

Related: Uber’s global ambitions hit roadblocks

But there comes a time when even the most scrappy of start-ups needs to grow up and embrace the responsibility that comes with creating a new market.

And in the case of companies such as Uber and Airbnb — both now valued at many billions of dollars — that means recognizing when you have become part of the establishment.

Such a transformation is never going to be easy, especially when so many tech firms are started by charismatic youngsters keen to become the next Steve Jobs — if less willing to hold their tongues, as Uber’s CEO learned the hard way.

Not only do such firms need to improve their image, it is also time they gave something back. And they could start with their staff.

For while the so-called “sharing economy” has helped home and car owners make a little money on the side, it hasn’t created many full time jobs. A lot of people employed by these firms are freelance.

So what can be done?

Venture capital, with its experienced investors, could play more of a role in steering such companies towards this goal. Indeed they have a duty to do so, to protect their investment.

Related: Google Venture: Fewer Ubers, more health care

Governments around the world should start adapting to the changing landscape such disruptors create, assessing the risks they pose to consumers and smoothing some of their rougher edges through smart regulation.

No one wants a sharing economy if it is not safe or rewarding.

Many of these firms, including Uber and Airbnb, say they are keen to work with authorities to resolve any cracks in the system as they arise.

In a rare example of working with regulators rather than against them, Uber has agreed to shut down its services in Portland, Oregon, for three months while the city updates its laws.

Today’s new game changers have already altered our daily lives, for which they deserve recognition. But for that legacy to last they — like the tech titans before them — need to mature and learn from past mistakes.

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Unilever lays an egg: Drops Just Mayo lawsuit

In Uncategorized on December 20, 2014 at 12:36 am

Building a better egg (with no chicken) 

Unilever takes its mayonnaise very seriously. But this time, the global food giant appears to have egg on its face.

In October, Unilever filed a lawsuit against Hampton Creek, a San Francisco start-up that makes an egg-free mayonnaise substitute called Just Mayo.

Unilever (UL) owns Hellman’s mayonnaise and Best Foods, and accused Hampton Creek of false advertising and unfair competition.

Unilever dropped the lawsuit Thursday. The company didn’t give a reason why.

The lawsuit claimed that Just Mayo does not meet the legal definition of mayonnaise since it isn’t made with eggs. Unilever also took issue with the Just Mayo label, which contains an image of an egg, and said the vegan sandwich spread was inferior in taste and “performance” to Best Foods and Hellman’s mayo.

Critics started a petition on calling on Unilever to “stop bullying sustainable food companies.” The petition received more than 112,000 signatures.

Related: These 10 food trends could dominate 2015

Unilever said in a statement that it withdrew the suit so that Hampton Creek “can address its label directly with industry groups and appropriate regulatory authorities.”

Hampton Creek, which also makes egg-free cookie dough, is on a mission to develop plant-based alternatives to products made with eggs. The company argues that current egg production is unsustainable because it requires farms to produce vast amounts of chicken feed, using up valuable resources such as water and land.

The company recently raised $90 million in funding from private investors, including Marc Benioff, founder and CEO of Salesforce, and Eduardo Saverin, co-founder of Facebook (FB, Tech30).

Related: Quinoa is now part of a complete, balanced, breakfast

Unilever, in its statement applauded Hampton Creek’s commitment to innovation and developing sustainable food products.

“It is for these reasons that we believe Hampton Creek will take the appropriate steps in labeling its products going forward,” said Unilever.

Hampton Creek chief executive Josh Tetrick welcomed Unilever’s decision.

“Hampton Creek was founded to open our eyes to the problems the world faces,” Tetrick said on Facebook. “This moment has only validated why.”

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U.S. ends TARP with $15.3 billion profit

In Uncategorized on December 20, 2014 at 12:36 am
gm assembly line
Treasury sold its remaining shares Friday in Ally Financial, it’s last remaining major stake from the $426 billion bailout of banks and the U.S. auto industry.

The U.S. government essentially closed the books on TARP with a $15.3 billion profit.

Treasury sold its remaining shares Friday in Ally Financial, its last remaining major stake from the $426 billion bailout of banks and the U.S. auto industry.

The Troubled Asset Relief Program was passed in 2008, in the wake of Lehman Brothers’ bankruptcy, as the nation’s financial system was on the verge of collapse and economists feared another Great Depression. At the height of the bailout, Treasury owned a significant stake in all of the major U.S. banks, such as Citigroup (C) and Bank of America (BAC), two of the nation’s Big Three automakers — General Motors (GM) and Chrysler Group (FCAM) — as well as one of its largest insurers, AIG (AIG).

But with the sale of the Ally (ALLY) stock, Treasury now only holds stakes in 35 small community banks.

Ally Financial was formerly known as GMAC, and had been GM’s finance arm. While it was hurt by the plunge in car sales, its move into subprime mortgages did the most damage. Ally was bailed out as part of the auto industry bailout, since its failure would have left a significant portion of the nation’s car dealers without the financing they needed to stay open.

Treasury received $1.3 billion from its final sale of Ally stock Friday, leaving it with a $2.4 billion profit on the company.

Overall, the auto bailout was the one big money loser for TARP. Even with the Ally sale, taxpayers lost about $9.2 billion.

But opting not to bail out the auto industry likely would have proven far more costly, since GM, Chrysler and many car dealers likely would have gone out of business without the government’s help.

If GM and Chrysler had gone under, it would have cost an estimated $39 billion to $105 billion in lost tax revenues as well as assistance to the unemployed, according to a study from the Center for Auto Research. And the government also would have been on the hook for billions in promised pension payments to autoworkers.

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McDonald’s violated worker rights: NLRB

In Uncategorized on December 20, 2014 at 12:36 am

The fast food protests are working 

A government labor watchdog has accused McDonald’s and some franchise owners of violating workers rights by retaliating against them for taking part in fast food protests.

The National Labor Relations Board said in several complaints filed Friday that McDonald’s (MCD) and franchise owners subjected workers to “discriminatory discipline” for participating in nationwide protests aimed at raising pay in the fast food industry.

According to the NLRB’s general counsel, the restaurant owners reduced hours and discharged some workers who took part in the movement. The employers also engaged in other “coercive conduct” against its employees, including surveillance, interrogations and restricting worker’s ability to communicate with union representatives.

The grassroots movement of fast food workers over the past three years, demanding higher wages and better treatment has been a key driver behind several states and cities this year raising their minimum wages, some as high as $15.

Related: Fast food workers stage nationwide strike

By naming McDonald’s along with its franchise owners as violators, the government agency also hits at the heart of the company’s franchise model. The vast majority of 14,000 McDonald’s restaurants in the United States are owned by franchisees. This has allowed the company to dodge responsibility for low wages and workplace violations at its restaurants.

But all that stands to change, if the agency is able to prove otherwise.

“The complaints issued today underscores what most everyone understands as common sense: That the company is responsible for the workers at its restaurants,” said Kendall Fells, an organizer with Fast-Food Fight for $15, one of the groups leading the protest movement.

Related: Fast food strikes go global

Friday’s complaints stem from 291 labor violations charges filed since November 2012, when the fast food protests began. The labor agency’s general counsel found merit in 86 of those cases, which were filed in dozens of cities around the country, including New York, Los Angeles, Atlanta, Chicago and Philadelphia, among others.

The complaints are a preliminary step in what is expected to be a lengthy legal battle.

At issue is whether McDonald’s can be considered a “joint employer” with its franchise owners. The NLRB’s general counsel will make that case to an administrative law judge who will determine if McDonald’s can be held liable under the National Labor Relations Act.

That trial will begin in March and will set the stage for the NLRB to issue a ruling that can be used in court.

Related: 24 hours with a fast food worker

Worker advocates say the complaints filed Friday suggest that the NLRB general counsel has seen evidence that McDonald’s meets the legal definition of a joint employer.

“Today’s news makes it clear that the NLRB finds merit in the claim that McDonald’s is a joint employer because it exerts substantial power over franchisees,” said Mary Joyce Carlson, an attorney for Fast-Food Fight for $15.

However, activists acknowledged that they are in for an uphill battle against the deep-pocketed and litigious fast food giant.

Related: 10 big overtime pay violators

McDonald’s said in a statement that it will contest the allegations. The company also said that the government agency “improperly and dramatically strike at the heart of the franchise system — a system that creates economic opportunity, jobs and income for thousands of business owners and their employees across the country.”

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