Franchisors

News & Analysis as of

Lessons from Recent NLRB Actions

The National Labor Relations Board (NLRB) Office of the General Counsel recently investigated allegations against various McDonald’s franchises and its franchisor, McDonald’s, USA, LLC. The charges were that the company...more

Employers Beware: McDonald’s Memorandum Suggests That the NLRB Intends to Loosen the Standard for When Legally Separate Entities...

In late July, the General Counsel of the National Labor Relations Board (the “NLRB” or “Board”) issued a memorandum in a group of cases against operators of several McDonald’s franchises. The memorandum is significant...more

Franchisor Not Liable for Sexual Harassment of Franchisee's Employee under FEHA

In Patterson v. Domino's Pizza, LLC, the California Supreme Court took on the issue of whether a franchisor is an "employer" of its franchisee's employees under the Fair Employment and Housing Act ("FEHA") and therefore...more

Did You Know…California Supreme Court Rules – No Franchisor Vicarious Liability

The California Supreme Court recently held in Patterson v. Domino’s Pizza, LLC, No. S204543 (Cal. Aug. 28, 2014) that a franchisor could not be held vicariously liable under the California Fair Employment and Housing Act...more

California Employment Law Notes

Franchisor Is Not Liable For Franchisee's Alleged Sexual Harassment Of Its Employee - Patterson v. Domino's Pizza, LLC, 2014 WL 4236175 (Cal. S. Ct. 2014) - Taylor Patterson was hired by Sui Juris (a franchisee...more

California Supreme Court Clarifies When a Franchisee's Employees Can Bring Employment Claims Against the Franchisor in Taylor...

In Taylor Patterson v. Domino’s Pizza, LLC, the California Supreme Court restricted the ability of a franchisee’s employees to sue the franchisor based on theories of vicarious liability and the theory that the franchisor was...more

Domino’s Pizza is Not Vicariously Liable for Acts of a Franchise Employee Where Domino’s Lacks Control Over Employee, Says...

Domino’s Pizza This week, the California Supreme Court held that Domino’s Pizza was not liable for the torts of an employee of a franchise because Domino’s had no contractual or operational control over the employee. The...more

Patterson v. Domino’s Pizza, LLC: Franchisors Are Not Vicariously Liable as “Employers” or “Principals” for Their Franchisees’...

In a significant win for franchisors, the California Supreme Court ruled 4-3 that although Domino’s “imposes comprehensive and meticulous standards for marketing its trademarked brand and operating its franchises in a uniform...more

Who's in Control Here? California's Supreme Court Establishes New Standards for Potential Franchisor Liability for Employee Tort...

On August 28, 2014, the Supreme Court of California, in Patterson v. Domino's Pizza, LLC, decided whether a franchisor was entitled to summary judgment on the plaintiff's claims that the franchisor was vicariously liable for...more

Landmark Ruling: Franchisor Not Liable Absent Employment Related Control

On August 28, 2014, the California Supreme Court issued a landmark ruling in favor of Domino's Pizza and all business format franchisors that do business in California. In Patterson v. Domino's Pizza, LLC, ---P.3d---, 2014 WL...more

Patterson v. Domino’s: California Supreme Court Lends Important Guidance on Franchisor Liability

Taylor Patterson claimed that Domino’s, as the franchisor of thousands of pizza stores across the nation, should be held responsible for sexual harassment she experienced from a fellow employee over a two-week period when she...more

Two Important NLRB Decisions: When Franchisees/Franchisers are a Joint Employer and Forming Micro Bargaining Units in Retail

On July 29, 2014, the General Counsel for the National Labor Relations Board (NLRB), Richard Griffin, authorized NLRB Regional Directors to issue complaints in 43 unfair labor practices cases against McDonald’s USA LLC. The...more

Franchising In India: Key Considerations For Franchisors Seeking To Grow Their Brands

India recently staged the largest free democratic election in world history, bringing to power the National Democratic Alliance, led by the Bharatiya Janata Par ty, and with it a fresh sense of optimism about India’s economic...more

National Labor Relations Board’s Threatened Expansion of Joint Employer Doctrine Would Increase Employment Law Risks for US...

To bring their full financial and operational expertise to portfolio companies, private equity firms frequently adopt an active approach to overseeing their investments. However, the greater a firm’s involvement in the...more

Would You Like Fries . . . and an Unfair Labor Practice Charge with That?

Mainstream media, attorneys, and business owners are discussing the meaning and impact of a two paragraph press release issued on July 29 by the Office of the General Counsel of the National Labor Relations Board (NLRB). That...more

Activity Before NLRB and WA Supreme Court Highlights Joint Employer Risk

A recent announcement by the National Labor Relations Board’s (NLRB) General Counsel and a Washington Supreme Court decision underscore the risks of potential joint employer liability...more

Big Mac Attack: Is the Franchisor a Joint Employer?

On July 29, 2014, the National Labor Relations Board (“NLRB”) issued a brief statement that could turn labor law in the world of franchising upside down. The NLRB’s General Counsel stated that it plans to go forward with a...more

Fifth Circuit Protects Franchisors, For Now

In the wake of the National Labor Relations Board General Counsel’s announcement that he intends to pursue unfair labor practice charges against a franchisor, franchisors are on high alert. With the NLRB considering an...more

Food, Folks, and Franchise-Wide Liability: NLRB Signals Intent to Pound Square Joint Employer Peg Into Round Franchise Hole

A big part of what makes the franchise model of business attractive to small business owners is the opportunity to own and operate their own business, but with their entrepreneurial risk backstopped by a known regional or...more

Update on Orozco v. Plackis: was franchisor’s principal the employer of franchisor’s employee? Fifth Circuit reverses – 3...

We reported in September 2013 about Orozco v. Plackis, a case out of the United States District Court for the Western District of Texas in which the plaintiff (a cook in a franchised restaurant) filed an action under the Fair...more

NLRB Challenges Franchise Model in Complaint Against McDonald’s

Last week, in an unprecedented shift away from long-standing Board precedent, Richard F. Griffin, Jr., General Counsel of the National Labor Relations Board (NLRB), asserted that McDonald’s, USA LLC (McDonald’s USA) — the...more

NLRB Moves Toward New Standard to Hold Franchisors Are Joint Employers of Their Franchisees' Employees

Over the last two years fast-food workers have engaged in walkouts and other activities protesting their wages and seeking an increase to $15/hr. Numerous unfair labor practice charges have been filed with the National Labor...more

Employer Identity Crisis: NLRB's GC Dramatically Expands Joint Employer Doctrine to Include Franchisors

Employer Status for Franchisors - Franchisors typically do not control hiring discipline, termination, or other employment decisions made at locations operated by independent franchises. Can they nonetheless be...more

NLRB Will Charge McDonald’s as “Joint Employer” For Franchisee Labor Violations

In a move with far-reaching ramifications for all businesses that license their brands to independent contractors including franchisees, the National Labor Relations Board (“NLRB”) announced on July 29, 2014 that it has...more

Franchisors Not Lovin’ It: NLRB Announces McDonald’s Named Joint Employer with Franchisees

On July 29, 2014, the National Labor Relations Board (NLRB) Office of the General Counsel announced that McDonald’s, USA, LLC will be named as a “joint employer” in at least 43 cases alleging unfair labor practices against...more

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