Franchisors, ‘Zees Gather in D.C. to Talk Joint Employer Issue
Calling this a “pivotal time for franchising legislation,” Michael Layman told the room full of franchisors and franchisees to convey their stories to lawmakers of how the National Labor Relations Board’s joint employer ruling has cost them money, affected decision-making and otherwise impacted their business.
Layman, the IFA’s vice president of regulatory affairs, was speaking to those gathered today for the association’s Franchise Action Network annual meeting in Washington, D.C., as they prepare to meet Wednesday with members of the House of Representatives to ask them to co-sponsor the Save Local Businesses Act.
Introduced in July by a U.S. House committee, the Save Local Businesses Act aims to define what it means to be a “joint employer,” stating the employer must “directly, actually and immediately” exercise significant control over the primary elements of employment to be so considered and thus liable for violations of workers’ rights. It counters the NLRB’s August 2015 ruling in the Browning-Ferris Industries case that adopted a broad joint employer standard based on “indirect” or “potential control” of employees, meaning franchisors can be held liable for a franchisee’s employees.
The bill, the IFA says, will help solve the joint employer issue for the franchise business model by fixing the problem under both the National Labor Relations Act and the Fair Labor Standards Act and provide clarity for local businesses on what it means to be a joint employer.
Speaking from the franchisor perspective, Mary Kennedy Thompson, COO of The Dwyer Group (Glass Doctor, Molly Maid, Mr. Rooter and others) said it's become difficult to support franchisees “in the way we want to support them” because of the ambiguity of the joint employer ruling.
“We’re hesitant to do some of the things we want to,” she said. “If we wanted to do something as simple as help them put together job descriptions, we were told that wasn’t such a smart legal move” because it opens up issue of the franchisor being involved with franchisee hiring.
“It’s now more true than ever to say it's a new day in Washington, D.C.,” said Robert Cresanti, IFA’s president and CEO, in his opening remarks. “And with this new landscape in front of us it’s an even more critical time for us to be here.”
The IFA says it has more than 250 meetings scheduled Wednesday with representatives and senators on Capitol Hill.