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McDonald’s Legal Boss Jerry Krulewitch Retires (1)

Oct. 15, 2020, 6:03 PMUpdated: Oct. 15, 2020, 9:22 PM

McDonald’s Corp. general counsel and executive vice president Jerry Krulewitch has retired at the suggestion of his doctors after he was diagnosed with Parkinson’s disease, according to a securities filing from the fast food giant.

The Chicago-based fast food company’s U.S. general counsel Mahrukh Hussain is serving as interim general counsel during the search for Krulewitch’s replacement, McDonald’s said in the Thursday filing.

“It has been a privilege to be a part of McDonald’s for almost 20 years. I am incredibly proud of everything the brand has accomplished and of the extraordinary legal team I have had the honor to lead,” Krulewitch said in a statement provided to Bloomberg Law.

Krulewitch departs in the middle of McDonald’s legal battle against former Chief Executive Officer Steve Easterbrook over his separation pay and Easterbrook’s alleged relationships with employees. Last week, McDonald’s also ended a meal promotion with rapper Travis Scott that the company said led to burger shortages at some restaurants.

Krulewitch’s decades-long career with McDonald’s officially ended Oct.12. His run at the company began in 2002, when he joined as vice president of litigation. He became corporate general counsel and secretary in 2017.

He was diagnosed with Parkinson’s, a condition that impacts the nervous system, earlier this year, according to a message to employees from McDonald’s CEO Chris Kempczinski viewed by Bloomberg Law.

“In recent weeks, and after much conversation with his doctors, Jerry has realized that his disease progression is now adversely impacting his ability to effectively perform as General Counsel and informed us that he has been advised to step down from his role,” Kempczinski said in the statement.

Krulewitch is one of several general counsel to partially forego compensation during the coronavirus pandemic. He took a 25% pay cut this year following the closure of many McDonald’s stores during the outbreak. In 2019, his total compensation was $3.25 million with a base salary of $642,500, according to company proxy statements.

Golden Arches Legal Challenges

During his tenure, Krulewitch led the company through expansions in Asia and Latin America. He was at also at the helm through the termination of Easterbrook, who left the company last fall over a consensual relationship with an employee that was said to violate corporate policy.

McDonald’s sued Easterbrook in August to recover $37 million in the executive’s compensation, alleging that he concealed evidence and lied about his actions after discovering he covered up multiple sexual relationships with employees. Easterbrook’s attorneys have called the case “meritless and misleading.”

The company has also faced a number of labor disputes in recent years, most notably butting heads with the “Fight for $15" organization which aims to increase minimum wages and unionize fast-food workers. McDonald’s has been criticized for short changing workers, illegally stifling union activities and shifting the legal responsibility for alleged labor violations to franchisee restaurant owners.

Joint Employer Fight

McDonald’s in recent years has become one of the highest profile corporations battling over the question of joint employment, or whether a franchise company is legally responsible as an employer of workers at restaurants owned by franchisees.

“The whole concept of trying to impute a perceived wrong on the part of a franchise to the main entity, or vice versa, is really problematic,” said Jonathan Segal, a partner at Duane Morris in the employment, labor, benefits and immigration practice group. He said that efforts to classify McDonald’s as a joint employer eliminated the nature of a franchise system, which gives franchisees day-to-day control of operations.

However, franchisors like McDonald’s still have a tremendous amount of control over their franchisees, said Terri Gerstein, the director of the State and Local Enforcement Project at the Harvard Law School Labor and Worklife Program as well as a senior fellow at the Economic Policy Institute.

“To me, it’s clear that in many instances, they should be found a joint employer,” Gerstein said. “But certain courts have allowed the franchise model to be a way for companies to evade the responsibility for ensuring a franchisee complies with the law.”

Seeking Diversity

Before joining McDonald’s, Krulewitch worked in private practice as a partner with Winston & Strawn and was an assistant U.S. attorney in the Northern District of Illinois for a decade.

Hussain, who takes over for Krulewitch, joined McDonald’s in 2000 and became U.S. general counsel in 2013. She began her career in private practice and as a judicial clerk.

McDonald’s is also searching for its first director of legal diversity, equity and inclusion. In a September LinkedIn post announcing the role, McDonald’s head of legal operations and chief of staff Mary Gardner Burrelle said the position would support and expand the legal department’s diversity efforts.

(Clarified the type of promotion between McDonald's and Travis Scott in paragraph four. Added comments from Jonathan Segal and Terri Gerstein in paragraphs 12-15. )

To contact the reporter on this story: Ruiqi Chen in Washington, D.C. at rchen@bloombergindustry.com

To contact the editors responsible for this story: Rebekah Mintzer at rmintzer@bloomberglaw.com; Chris Opfer at copfer@bloomberglaw.com

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