Joint Employer ‘Could Be Catastrophic’ for Franchise Model, ‘Zees Say
“If joint employer was like this 25 years ago, there’s no way I would have become a franchisee,” Matthew Patinkin tells Julius Niyonsaba, a legislative aid to Illinois Sen. Richard Durbin.
Patinkin, a multi-unit franchisee with dozens of Auntie Anne’s Pretzels stores in several states, including Illinois, is among the hundreds of franchisees and franchisors meeting with representatives and senators (and their aids) on Capitol Hill today as part of the International Franchise Association’s Franchise Action Network event in Washington, D.C.
The joint employer issue referenced by Patinkin is the foremost issue facing the franchise industry, the IFA says, as it pushes for support of the Save Local Businesses Act, which counters the National Labor Relations Board’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.
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. While a similar bill hasn’t been introduced in the Senate, Patinkin says meeting with senators is equally important as the franchise industry seeks a permanent legislative fix to the joint employer issue.
Right now, Patinkin tells Durbin’s aid, as the owner of a business “I hire people, I determine their schedule, I determine their pay, I terminate people.” But if the new joint employer standard remains, “essentially the franchisor has the liability over every aspect of that … it takes away my control over those things.”
“This top-down approach is not why I got into this business,” adds Richard Ueberfluss, an Assisting Hands Home Care franchisee with locations in Naperville and Hinsdale, Illinois. “This is my business. Joint employer could be catastrophic for my business in terms of cost.”
In the House, 44 representatives and counting—including two Democrats—have signed on as co-sponsors of H.R. 3441, the Save Local Businesses Act, originally introduced by Rep. Bradley Byrne (R-Ala.).