Franchise Updates

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

A Fresh Take on the Horizontal Joint Employment Theory: Conditional Certification for Subway Employees Denied

Seyfarth Synopsis: Federal court denies motion for conditional certification for a proposed class of employees working at separate Subway franchises. Earlier this year, the DOL’s Wage-Hour Division issued a...more

FRANCHISOR 101: Recent “Franchisor as Joint Employer” Developments

In the last month, McDonald's settled a class action with employees of a franchisee, and a new President of the United States was elected. These two events have something in common with regard to franchising: they are...more

Court Grants Default Judgment Confirming Arbitration Award, With A Lesson On Jurisdiction

Choice Hotels filed an application to confirm an arbitration award of over $247,000 for the alleged breach of a franchise agreement by two defendants, which failed to timely commence construction of a hotel. The defendants...more

Catch-22 for Franchisors: The Joint Employment Dilemma

As government agencies steadily expand the concept of joint employment, franchisors increasingly find themselves in a difficult position. Since August 2015, when the NLRB ruled in Browning-Ferris that entities with the...more

Your Own Agreements Can Be Your Worst Enemy in IC Misclassification Cases

Companies that use independent contractors (ICs) typically require ICs to sign a contractor agreement prepared by the company. But, if it is drafted like the one reviewed in late September by the U.S. Court of Appeals for the...more

Franchising Update

Franchising has undergone several significant changes in the last quarter. Firstly, the introduction of the Unfair Terms Legislation will no doubt impact the documentation used by franchisors. Secondly, franchisors operating...more

How a Trump Presidency Impacts Labor Relations in the Hotel Industry

President-elect Trump is unlikely to support continued federal labor and employment agency activism in wage and hour and other employment-related matters. What does this mean in the context of the hotel industry? Can hotel...more

THANKSGIVING EDITION [FROM THE ARCHIVES]: Court Protects Quizno’s Franchise Turkey Trade Secrets

This Thanksgiving, Trade Secrets Watch is serving a delicious tale about protecting trade secrets in a franchising relationship. In 1994, Quizno’s entered into a franchise agreement with Robert Kampendahl, an...more

Browning-Ferris Appeals the NLRB’s Revised Joint-Employer Test

In August of this year, the National Labor Relations Board (NLRB) revised its joint-employer test, which has incited much debate from employers across the country. The newly developed test permits a worker to be considered an...more

Top Takeaways: 2016 American Bar Association Forum on Franchising

Marc Lieberstein - Marc Lieberstein, Kilpatrick Townsend partner in the firm’s New York office, was honored to participate in the “Mine is Better Than Yours! The Risks and Rewards of Conducting Comparative Advertising”...more

Bentonville McDonald’s To Pay $103,000 To Settle EEOC Disability Discrimination Suit

Restaurant Fired Employee Because of His HIV Status, Federal Agency Charged - LITTLE ROCK, Ark. - A McDonald's restaurant owned and operated by Mathews Management Company and Peach Orchard, Inc. in Bentonville, Ark.,...more

The Potential Impact Of a Trump Presidency on Employers

Based on promises made during the campaign, it appears employers may expect changes in the government’s approach to workplace regulation. Although we certainly do not have a crystal ball, President-elect Trump campaigned on a...more

Franchisors Should Consider Signing a Conditional Lease Assignment Rather Than a Franchisee’s Lease

In Franchise & High Properties, LLC v. Happy’s Franchise, LLC, a 2015 decision issued by the Court of Appeals in Michigan, the franchisor, Happy’s Pizza Franchise, LLC, signed a five-year lease for the commercial space to be...more

ManattJones Global Strategies - November 2016

CEO’s Executive Summary: October news was dominated by cabinet changes and progress on the 2017 budget. Senator Raul Cervantes replaced Arely Gomez as attorney general, reflecting renewed efforts to stem crime and corruption...more

Franchisee’s & Self-Employment Taxes

In a recent Chief Counsel Advice (CCA 201640014, issued 9/30/2016), the Office of Chief Counsel (“OCC”) of the Internal Revenue Service found that all of a franchisee’s share of earnings from a partnership that operating...more

Joint / Related / Common Employers: Are You at Risk

In recent years, a number of cases have emerged in both Canada and the United States discussing new implications for companies deemed to be joint and related employers. Cases both from the United States and across Canada will...more

Are you a joint employer?

Are you an employer who uses temporary employees, staffing agencies or independent contractors? Use of such contingent or contract workers is not unusual and may be necessary for your operations. If you are in that...more

FRANCHISEE 101: Is It a Franchise? Yes and No

A federal court in Indiana made an interesting decision on whether a business relationship was a franchise. Wabash National Corp. is a famous maker of semitrailers. Wabash notified a dealer in Texas that its dealership was...more

FRANCHISOR 101: Original Content Needed to Protect Ops Manuals

An important part of the franchise system is the confidential operating manual. Many franchisors claim protection of operating manuals under the law of trade secrets and copyright. Keeping the contents confidential is...more

Correcting an Accidental Franchisor Violation

What’s a franchise? Franchise registration and disclosure laws define a “franchise” more broadly than people generally realize. A company may be franchising without knowing it. The “license” agreement may have been...more

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

Over 2,300 current and former employees of 16 McDonald’s franchisee locations in Pennsylvania claimed that mandatory use of payroll debit cards violates the Pennsylvania Wage Payment and Collection Law (“WPCL”), and the...more

Hotel News Update: Amicable Resolution Reached in High-Profile Litigation Over Management Agreement

Marriott International, Inc. ("Marriott") and Eden Roc, LLLP ("Eden Roc"), the owner of the Eden Roc Hotel in Miami Beach, Florida, have jointly announced an amicable resolution of their ongoing litigation concerning the...more

Third Circuit affirms class certification in franchisee-as-employee class action

In a recent sharply divided 2-1 decision, the Third Circuit Court of Appeals affirmed the grant of class certification against commercial cleaning franchisor Jani-King in a lawsuit alleging that Jani-King’s franchisees were...more

Alphabet Soup?

Several years have now passed since the financial crisis and the onslaught of regulations intended to prevent a future crisis. Regulatory reform has assuredly resulted in significant changes to our financial services sector....more

Five Critical Wage and Hour Issues Impacting Employers

It is no secret that the wage and hour requirements found in the myriad of federal, state, and local laws and regulations present unique challenges to employers across the country. Those challenges are further complicated by...more

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