Earlier this month, McDonald's announced it would raise wages for 90,000 employees in the 1,500 corporate-owned restaurants to at least $1 over the local legal minimum wage. That would equal an average of $9.90/hour by July 1.
But it's a far cry from what many in the industry want. Last week, thousands of minimum wage workers from New York City to Los Angeles protested in front of fast-food locations demanding $15-an-hour wages.
"We do focus on making sure that we do pay our people fairly. So the rest of the industry, when they talk about raising their wages, they are actually catching up to where we are," says Boston Market CEO, George Michel, who says the private company averages about $1.15 per hour above local minimum wages.
“We pay our employees [more] because we have more full-time employees than part-time employees," he says.
Michel's view on starting wages may come from his personal experinence in the industry. He started in the restaurant business in 1971. While attending the University of Toronto, Michel worked as an hourly cook in the kitchen of A&W. It’s a company he later returned to as an executive, running its American division. Michel, who immigrated to Canada from Israel in his teens, says, “This is a great industry where people like me and students…can forge a great future in a restaurant.”
Michel took the helm as CEO of Boston Market in 2010. But he prefers the title, ‘The Big Chicken,” instead (It’s even on his business card). Michel says over the past three years business is booming with sales are up 28% and average sales of $1 million per restaurant to $1.3 million.
“People have more money in the pocket right now, discretionary income is up," he says. "And people feel much better when they fill up their gas tank for $30 instead of 50."
Boston Market hasn’t opened any new locations in a few years but it is planning to open 10-12 new restaurants this year. Most of the new stores will be in the New York City metro area.
Another area of growth: U.S. Army bases. Boston Market opened two locations on bases last year. Michel says the locations did phenomenally well and the company plans to open four to six more this year. "There are about 20 [additional army base locations] that are in the pipeline," Michel says. "The army has been very, very receptive about our food."
Started as fresh alternative to fast food, Boston Chicken was founded in 1985—in, of course, Boston. The company went public in 1993 after expanding beyond the Boston region. The menu evolved beyond fresh chicken too, and in 1995, Boston Chicken was rebranded Boston Market. But the business hit tough times—in part because of an “indentity crisis” following an expansion into hams, meat loaves and sandwiches-- and Boston Market filed for bankruptcy in 1998. Many locations closed. It was purchased by McDonald’s for $173.5 million in 2000.
The Boca Raton, Florida-based private-equity firm Sun Capital Partners owns Boston Market today.
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