Franchise Updates

Read need-to-know updates, commentary, and analysis on Franchise issues written by leading professionals.
News & Analysis as of

Cuba Si! Trade With Cuba … Not Quite Yet

There has been much fanfare surrounding the reestablishment of diplomatic relations with Cuba, starting with President Obama’s announcement of the resumption of bilateral relations, and followed by the formal establishment of...more

Restaurant Industry Alert: Wage Board Proposal - Fast Food Workers' Minimum Wage May Rise to $15 in New York City by 2018

On July 22, 2015, the New York State Department of Labor's (NYSDOL) Wage Board voted to recommend a 171 percent increase in the minimum wage for fast food workers in New York City (NYC), from the current hourly rate of $8.75...more

Wage Board Recommends an Increase in the Minimum Wage for Fast Food Workers to $15.00 Per Hour

On July 22, 2015, the Fast Food Wage Board (which was empaneled at the direction of Governor Cuomo to investigate and make recommendations regarding an increase in the minimum wage for employees in the fast food industry)...more

Subway Franchise in Albany Sued by EEOC for Sexual Harassment of Teen Job Applicants

Restaurant Manager Sent Sexually Offensive Texts Demanding Sex for Jobs, Federal Agency Charged - ALBANY, N.Y. - Draper Development, LLC, doing business as Subway, which operates at least 24 Subway restaurants in the...more

New York Bill Follows California’s Lead to Recognize Professional Cheerleaders as Employees

It’s official—professional cheerleaders are now recognized as employees under California law. On July 15, 2015, California Governor Jerry Brown signed a bill that requires all California-based professional sports teams to pay...more

Franchise and Distribution News - July 2015

A VIEW FROM TWIN PEAKS - Quick. Define Twin Peaks. Other than the obviously now dated TV show, up until a couple of weeks ago, the only other definition of Twin Peaks was a restaurant chain that featured double entendre...more

Reflections on the Origins of the NY Franchise Act

I recently had occasion to review the legislative history of the New York Franchise Sales Act (NYFSA). The NYFSA was enacted into law in 1980 and became effective January 1, 1981. At that time, Robert Abrams was the NY...more

Looking Forward by Looking Back: China’s Franchise Regulations After Eight Years

On July 1 and 2, we, representing the International Franchise Association, met with China’s franchise regulators in Beijing and Shanghai. The conversation would be familiar to anyone who has been closely following the...more

Supreme Court Broadens Scope for Housing Discrimination Claims

Beneficial intent will not shield lenders and other financial services companies from discrimination claims under the Fair Housing Act (FHA), according to a recent decision by the United States Supreme Court. Specifically,...more

Spotlight on Manufacturers: Tennessee's 2015 Tax and Related Legislation

Manufacturing is a primary driver of our economic growth. As such, those businesses involved with fabricating, processing, converting and producing goods in today's marketplace must be ever-vigilant regarding new laws that...more

Franchise Transfers

Most hotels operate under a Franchise Agreement. Franchise agreements, including those in the hospitality industry, are personal contracts for the benefit of the named franchisee only, and are further limited by the...more

Crossing the Line: Don't Let Business Clients Become Accidental Franchisors

Too often, expansion-minded business owners choose to offer trademarked products or services through purported licensing agreements or distribution or dealership arrangements only to discover, well into the game, that what...more

Do You Know Who Your Employees Are?

Employers are beginning to learn that they may have far more employees than they think. A driver for the ride sharing company Uber was considered an “employee” by the California Labor Commissioner’s Office earlier this month....more

Eighth Circuit Upholds Arbitration Agreement In Absence Of Actual Proof Of Unconscionability Due To Cost

The Eighth Circuit affirmed a decision by the U.S. District Court for the Eastern District of Missouri which rejected the contention that an arbitration agreement was unconscionable, and unenforceable under the Federal...more

FRANCHISEE 101: Pay Now or Pay Later – Liquidated Damages & Future Royalties

Super 8 Worldwide, Inc. v. Anu, Inc. serves as a reminder to franchisees that, in general, courts will hold franchisees and their guarantors liable to their franchisors for losses suffered when franchisees abandon their...more

FRANCHISOR 101: Disclosure Violations & Running the Risks of Rescission

Despite a district court's recent decision in Braatz, LLC v. Red Mango FC, LLC, franchisors are well advised to comply with applicable disclosure requirements to a "T" to ensure new franchisees will not have an ongoing right...more

Polsinelli Podcast - Is a Single U.S. Food Agency a Reality? [Video]

In the United States, 2015 has brought forth several regulatory proposals in what has become a perpetual Washington, D.C. conversation: Why is there more than one federal agency responsible for food safety and what can and...more

Spotlight on Tennessee: 2015 Tax and Related Legislation

The 2015 Legislative Session, 109th General Assembly, considered a large number of tax and related initiatives. Many of these initiatives have been enacted, some with very far reaching impact upon the tax climate in this...more

DOL Wage and Hour Division to "Clarify" FLSA Independent Contractor Definition

The DOL’s Wage and Hour Division expanded its already busy agenda, announcing upcoming guidance on the Fair Labor Standards Act’s definition of “independent contractor.” WHD Administrator David Weil, speaking at New York...more

Asset-Light Strategy Issues in the Development Space

While asset-light strategies have been used for decades in the hotel industry, the strategy and how to implement it are a bit more complicated in the development space, whether for a hotel or time-share company. A typical...more

Tennessee Takes Shot at NLRB in New Law Limiting Franchisor Liability

Franchisors in Tennessee can breathe a small sigh of relief thanks to a newly enacted state statute that seeks to limit their potential liability and strike back at the general counsel of the National Labor Relations Board....more

What’s an Exclusive Territory?

The extent of a franchisee’s territorial rights is the subject of Item 12 of the franchise disclosure document (FDD). One of the questions franchisors must address in Item 12 is whether the territory is exclusive....more

McDonald's Mandatory Use of Payroll Cards Violates Pennsylvania's Wage Payment and Collection Law

Over 2,300 current and former employees of 16 McDonald’s franchisee locations in Pennsylvania claim that requiring the use of payroll debit cards to get paid violates the Pennsylvania Wage Payment and Collection Law (WPCL),...more

NLRB Weighs-In on Franchise Joint Employers

In late April, the National Labor Relations Board (“NLRB” or the “Board”) General Counsel’s office issued an Advice Memorandum (“Advice Memo”) (No. 177-1650-0100, available here) addressing whether a franchisor (Freshii...more

May 2015 Independent Contractor Compliance and Misclassification News Update

May 2015 was one of the busiest months for independent contractor (IC) misclassification cases in the courts and administrative agencies – no less than a dozen cases including such well-known companies as BMW, the NFL and...more

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