Andy Puzder has spent the last 16 years turning around what was once a struggling fast food company.
But as Puzder, the CEO of CKE Restaurants and Trump’s nominee for secretary of labor, gears up for his confirmation hearing on February 2, some of his former employees have protested his nomination and called into question whether he will protect the rights of workers in his new role.
“I gave more than 20 years of my life to CKE, and Mr. Puzder took a company that I loved and turned it into a business that makes money by stealing from its workers,” Laura McDonald, a former Carl’s Jr. general manager, said in a recent forum hosted by Senate Democrats.
In June 2000, Andy Puzder was named president and CEO of CKE Restaurants, running Hardee’s and Carl’s Jr. restaurant chains.
Puzder was central to transforming Hardee’s, the struggling Southern and Midwestern chain, into the mirror image of West-coast centric Carl’s Jr.
At Hardee’s, he significantly cut down the menu, updated restaurant design, and launched a marketing campaign that featured scantily clad women in bikinis.
In 2011, Puzder told Nation’s Restaurant News that one of his first moves on the job was issuing a memo that read, “No more people behind the counter unless they have all their teeth. And anyone who says ‘this is how we’ve always done it’ is fired.”
The revamp largely worked.
- Fab Fernandez and CKE Restaurants
In 2016, CKE Restaurants, which is a privately-held company, made $4.3 billion in annual revenue, the companytold The New York Timesin January. The company reported an annual revenue of $1.8 billion back in 2000 when Puzder took over.
Supporters believe that this financial turnaround makes Puzder the perfect pick for labor secretary.
“We are excited that Andy Puzder will serve as our nation’s next Secretary of Labor,” Dawn Sweeney, the National Restaurant Association’s president and CEO, said in a statement. “He has a proven track record of turning around struggling businesses, and his background in the restaurant industry will help foster an environment for job creation.”
But critics believe there is a dark side to the chains’ successes – and their voices have grown louder since Trump nominated Puzder to oversee the government agency that is tasked with protecting the American workforce.
Earlier in January, Hardee’s and Carl’s Jr.’s workers protested Puzder’s nomination in 20 cities across the US, organizing with the Fight for $15 movement to raise the minimum wage.
According to McDonald, a former general manager, Puzder helped create a business model that consistently overworked employees.
“Everything from CKE is controlled from the top. There are thousands of pages of manuals that control everything,” she said. “CKE requires all its managers to be available 24/7… The work is nonstop. I worked more than 60 hours a week there.”
Puzder has positioned himself as a staunch opponent of workplace regulations like overtime rules, which he say hurt business.
“Owners set their own hours and work the hours necessary using their best business judgment rather than a schedule set by a superior,”he wrote in Forbes in 2015.“Turning highly sought-after entry level management careers into hourly jobs where employees punch a clock and are compensated for time spent rather than time well spent is hardly an improvement on the path from the working class to the middle class.”
- Jack Plunkett/AP Images for Carl’s Jr.
McDonald said she ultimately left the company after her restaurant in part because she wasn’t being paid for overtime hours.
“Since [Carl’s Jr. founder] Mr. Karcher passed away, CKE has tightened its budgets in such a way that it makes it impossible to do the jobs without working off the clock,” McDonald said. “Worse, the company just seemed to not care about the employees anymore. I think Carl Karcher would be ashamed of what CKE has done to its employees.”
A recent report by the workers’ rights nonprofit Restaurant Opportunities Centers (ROC) United found that 28% of Carl’s Jr. and Hardee’s employees surveyed said they had worked off-the-clock and roughly 33% reported wage theft violations, such as not receiving or overtime pay. Those percentages are higher than fast-food industry averages.
The New York Times reported that CKE Restaurants has been found guilty of wage theft in dozens of cases and the Labor Department has forced the company to pay employees who had been underpaid in more than one instance. Still, an examination of Labor Department data by BNA Bloomberg found that CKE Restaurants has one of the highest rates of compliance in the industry.
- Carl’s Jr
Hardee’s and Carl’s Jr. have cut costs by increasing the number of part-time workers as compared to workers to full-time workers, something Puzder has argued is a necessary reaction to the Affordable Care Act, which requires large employers to provide health insurance to all full-time workers.
Puzder has also come under fire for saying that fast-food chains will increasingly rely on machines, instead of human employees, if states raise the minimum wage.
“[Machines are] always polite, they always upsell, they never take a vacation, they never show up late, there’s never a slip-and-fall, or an age, sex, or race discrimination case,” Puzder told Business Insider of potential benefits of automation in March.
While investing in automation is increasingly a trend in the fast-food industry and beyond, CKE Restaurant employees took offense to Puzder’s appreciation for technology that could cost them their jobs.
“Andy Puzder is against unions, calls the minimum wage and overtime ‘restrictions’ and employees ‘extra cost,’ and even said he wants to fire workers like us and replace us with machines that can’t take vacation or sue their employers when they break the law,” the nonprofit Interfaith Worker Justice quoted Rogelio Hernandez, a Carl’s Jr. cook, as saying.
Ultimately, Puzder’s critics say that he is unfit to be Secretary of Labor because he has prioritized CKE Restaurant’s profits over workers’ well-being. Meanwhile, supporters say that Puzder’s ability to grow Carl’s Jr. and Hardee’s – and therefore create more jobs – is proof of exactly why he should be confirmed for the position.
“Andy Puzder has firsthand experience saving and creating thousands of jobs, and he has an extensive record of fighting for workers,” a spokesperson for Puzder told Business Insider. “As Secretary of Labor, he will be able to apply his business successes in a way that will benefit all Americans – growing wages and creating opportunity.”
With critics blasting CKE’s treatment of employees, Puzder has taken to blocking labor advocacy groups on Twitter, BuzzFeed reported. CNN reported that Puzder has had “second thoughts” about accepting the nomination as secretary of labor.
“He is not into the pounding he is taking, and the paperwork,” a source with knowledge of the Trump transition effort told CNN, referring to the ethics and financial paperwork required by the Office of Government Ethics.
The National Restaurant Association said that Puzder “has made it clear he is not withdrawing from the nomination process.” After the CNN report was published, Puzder tweeted that he is “looking forward to his hearing.”