Much like other countries, college students look for part time work to help ease the burden of the costs of a higher education.

Now it is being reported by several news sources (IHT & AP) and CSR Asia, that McDonald’s and Yum are both under investigation for underpaying part-time staff. Making up the majority of total employees, these part timers are typically students in school.

While the news is still fresh, and there has been no conclusion to the investigation, the  facts (unverified) being reported are:

1. The minimum wage in Guangzhou is .97 USD/ hour
   • The New Express Daily said that McDonald’s was paying part-time employees only 52 cents an hour, while they earned 61 cents at KFC and 65 cents at Pizza Hut (Note: Imagethief reports that the minimum wage is 4.3RMB/ hour.. which would put KFC and Pizza Hut above the line, but McDonald’s would be below
2. The part time staffers were working enough hours to be considered full time, but were not receiving full time wages or competition
3. There seems to be some confusion over exactly how students are to be treated as per the existing and previous laws
   • IHT: Yum Brands said that the allegations resulted from confusion over whether the laws pertaining to part-time workers included students, who according to the New Express Daily constitute 70 percent of part-time staff in such establishments.

For those who have been watching the developments surrounding the yet to be released labor laws, this is exactly the type of situation the government is seeking to address.

If the allegations prove to be true, this will be another case of where MNCs did not act in a responsible manner when constructing, implementing, and monitoring their HR policies.

Parsing the line of whether or not a student is a part time student is just a rookie error, and shows that those in charge were more concerned about short term gains vs. long term sustainability. It is a lesson that Nike paid dearly for 10 years ago, that forced Disney to recently severe a supplier relationship, and will be a critical issue for many in the future once the new labor laws are enacted.

In the end, this is a matter that still needs to be properly investigated, but by parsing the line, Mcdona;ld’s and Yum have reopened the door that the court of public opinion may walk through…. and as seen in many cases in the last 12 months, Chinese consumers have been very effective in affecting change.