Day 247 - 10 May 96 - Page 26


     
     1        some restaurants, where our licensees may take another
     2        tack.  I do not know their individual policies, what they
     3        may or may not do in their own businesses, but certainly,
     4        we follow the market.
     5
     6   MS. STEEL:  So it is basically correct to say that you keep
     7        wages as low as possible?
     8        A.  No.  I said we follow the market.
     9
    10   MR. MORRIS:  And what Mr. Copeland said that we read out when he
    11        pointed out the protection of the Wage Council in the
    12        United Kingdom, that there is no equivalent legislation
    13        protecting the minimum wage of employees in the other
    14        countries that he referred to.  He said:
    15
    16        "The only protection is the negotiated tariffs set by the
    17        Employees Association and the union coalition by
    18        negotiation and bargaining."
    19
    20        The reality in the UK is there is now no Wage Council
    21        protection and there is no union coalition negotiating with
    22        catering employers, so there is no protection at all.  That
    23        is the reality now; is it not?
    24        A.  I do not accept that.
    25
    26   Q.   For minimum wages?
    27        A.  I do not accept that.  It totally ignores that a
    28        business has to survive on the High Street.  It is in
    29        competition with other businesses for staff.  If it does
    30        not pay a competitive wage, it does not stay there.  If it
    31        overpays, sooner or later it goes broke, and there is no
    32        business to employee anyone in the first place.  So we have
    33        a kind of a catch 22:  Do you want a business or do you
    34        want no business?  Do you want a profitable one or a
    35        bankrupt one? You therefore follow the market place.  It is
    36        just sense.
    37
    38   Q.   I want to go back to a couple more questions on pay.
    39
    40   MS. STEEL:  Your profits are not slim though, are they?
    41        A.  Who are you speaking of?
    42
    43   Q.   McDonald's.
    44        A.  The global Corporation?
    45
    46   Q.   The UK Corporation, the UK company, both?
    47        A.  I think we make a fair profit for what we have
    48        invested, albeit we live in a world where property
    49        expenses, rents, are very high.  They get reviewed every
    50        few years, and very quickly if a business does not keep its 
    51        profit growing it will be unprofitable because operating 
    52        costs get away from it.  So we make a fair return on our 
    53        investment, yes.  My shareholders, the Corporation
    54        shareholders seem to think so.
    55
    56   Q.   In the UK in 1993 you made £75.25m profit; is that right?
    57        A.  I do not know the number, but I would be surprised if
    58        our after-tax profit was that.  You would have to show me
    59        the accounts.
    60

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