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ZorBlog

A Legal Blog for Franchisors

Category Archives: Franchisor

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If Your Company Uses Subcontracted Labor, the NLRB May Find You to Be a “Joint Employer”

Posted in Franchisor
The National Labor Relations Board (NLRB or Board) has just announced its long‑anticipated decision in Browning-Ferris Industries of California, Inc. That case had been pending before the Board since April 2014, when the Board announced that it would reconsider the standards for determining joint‑employer status under the National Labor Relations Act. The Board invited briefs on… Continue Reading

News from Around the World: South Korea and Indonesia

Posted in Around the World, Franchisor, International Franchising
South Korea Will Woods of Baker & McKenzie gave an update on the 14 February 2014 amendments to the Korean Fair Franchise Transactions Act. A few of the changes that took effect in February are retroactive and will apply to contracts already in place at the time of the amendments. Retroactive amendments include: • franchisors… Continue Reading

News from Around the World: Germany

Posted in Around the World, Franchisor, International Franchising
Editor’s Note: This series of posts we’re calling “Around the World” come from a larger piece written by Shannon McCarthy and published in the October 2014 edition of the International Bar Association’s International Franchising Newsletter. Updates were provided by speakers at the Annual IBA/IFA Joint Conference that took place in Chicago in May 2014. Dr.… Continue Reading

Washington DFI Proposed Rule Changes

Posted in Franchisor, Legislation, Washington FIPA
The Washington State Department of Financial Institutions recently published proposed changes to the agency regulations governing delivery of an FDD subject to Washington’s Franchise Investment Protection Act. The new provision would expressly permit franchisors to deliver an FDD over the internet or by other electronic means. The current rule is silent as to the method… Continue Reading

NLRB’s General Counsel Provides a Glimpse of His Thinking on “Joint Employer” Standard

Posted in Franchisor, Policy
On July 29, the NLRB’s General Counsel Richard Griffin announced that he would allow administrative actions to proceed against McDonald’s as a “joint employer” of a franchisee’s employees. Since then, the NLRB has been asked to explain the rationale for that decision. While no formal explanation has been provided, POLITICO’s Brian Mahoney recently reported that… Continue Reading

The Battlefield for Franchising: Vicarious Liability

Posted in Franchisor, Legislation
In late August, the California Supreme Court held in Patterson v. Domino’s Pizza, Inc., that Domino’s is not vicariously liable for the inappropriate conduct by a franchisee’s employee. Specifically, the court held that the Franchisor is not responsible for sexual harassment by the assistant manager of a franchised location. The Patterson decision is, of course,… Continue Reading

California to Amend Franchise Laws in Response to…Something? Maybe?

Posted in Franchisor, Legislation
On Thursday the California legislature approved a bill amending the state’s franchise laws. Pending signature by Governor Jerry Brown (almost certainly a foregone conclusion), the changes will be official. As discussed in more detail below, the changes were made to California’s Franchise Relations Act (CFRA), and relate exclusively to the relationship between the franchisor and… Continue Reading

IFA Motion Highlights Discriminatory Intent behind Seattle’s $15 Minimum Wage Law

Posted in Franchisor, Legislation
With the recent enactment of a $15 per hour minimum wage ordinance, the City of Seattle has positioned itself as ground zero for the ongoing struggle over income inequality and wages. In adopting the ordinance, the City explicitly recognized that it would pose a hardship on small businesses, and therefore implemented a tiered structure that… Continue Reading

NLRB Says McDonald’s Franchisor is a “Joint-Employer” with Its Franchisees

Posted in Franchisor, Policy
In a potentially far reaching decision rendered today, the National Labor Relations Board (NLRB) has permitted 43 claimants to proceed with claims against the McDonald’s USA, LLC, franchisor of the McDonald’s restaurant chain, for unfair labor practices allegedly committed by McDonald’s franchisees. The decision followed a lengthy investigation into 181 complaints that workers were allegedly… Continue Reading

Using the Franchise Agreement to Discourage Free-Riding

Posted in Franchisor
From a franchisor’s perspective, it is important that all customers receive the same quality product and service offering regardless of what outlet they may visit. The menu of product offerings must be consistent, and the procedures for customer service correctly followed. The value of the franchisor’s brand depends on this consistency, and the more valuable… Continue Reading