Business owners protest potential rules on franchises
Published: March 6, 2015
TAMPA — A coalition of business owners in Tampa took to the streets downtown Friday to protest potential federal rules they say will crimp their franchise operations.
At issue is whether the National Labor Relations Board will treat individual franchisees of a brand as separate companies, or treat them as a “joint employer” nationwide, and thus expose local operators to more strict federal scrutiny.
“We believe that spreading that liability among all franchisees will only raise the cost of doing business and raise barriers against anyone looking to start a small business as a franchisee,” said Ted Peterson, a spokesman for the Job Creators Network group in Tampa that organized a protest among local companies. “This could be people who work at your hotel, who prepare your food, who walk your dog. We’re concerned this could set a damaging precedent.”
About 20 people attended the protest in Tampa, and the group delivered a letter to local NLRB officials.
The NLRB will soon consider appeals by McDonald’s Corp. and other major companies that say such joint treatment rules would limit their business and hinder local hiring.
Labor groups, by contrast, say parent companies should be considered a “joint employer” that exerts control over local franchises, and therefore are partly responsible for any labor law violations at individual locations. Such labor groups have been increasingly active with labor protests, and have put pressure on major companies, including Wal-Mart Stores Inc., which recently agreed to raise wages.
The NLRB’s Office of General Counsel contends McDonalds Corp., through its franchise relationship and business practices, had enough control over franchisee operations to be considered a joint employer of their workers, said Jessica Kahanek, an NLRB spokeswoman. She declined further comment while the cases are being litigated.
The NLRB hearings stem from nationwide protests by employees seeking higher pay. The workers accuse the companies of retaliating against employees who took part in protests and restricting their attempts to discuss working conditions with each other or union representatives.
McDonald’s did not respond to requests for comment by the Associated Press. In a statement following the general counsel’s decision, McDonald’s said it offers franchisees resources to help them manage restaurants, but that does not create a joint employer relationship.