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Franchisors and Franchisees Face a Tough Adversary

by Ed Teixeira

The franchise industry faces a formidable organization whose motives go far beyond simply supporting franchise legislation.

Over a year ago I wrote an article entitled When Franchisors and Franchisees Should work Together which cited proposed regulations and legislation that could impact the entire franchise industry. Since that time a number of events have taken place, including aggressive picketing of various franchised fast food locations, a $15 minimum wage statute enacted in Seattle, Washington also proposed in other large cities, and efforts by the NLRB to rule in favor of Joint Employer status for franchisors beginning with McDonald's, which is facing litigation from the NLRB.

However, there is one significant change that's taken place since a year ago and that's the active and open participation and support of the Service Employees International Union (S.E.I.U.) for an increased minimum wage and joint employer status designation applied to McDonald's.

In the recent past the S.E.I.U. was operating behind the scene so to speak, utilizing its money and political influence in support of actions against franchisors and franchisees. With over 2 million members and a take no prisoners approach, the S.E.I.U. has openly announced their support for franchise legislation beginning with California.  Although Governor Jerry Brown refused to sign a recent franchise bill approved by the legislature, the current bill once approved will be heavily lobbied by the S.E.I.U. The support and efforts by the S.E.I.U. will place some franchisee organizations in a difficult position, since although they may support franchise legislation they are not in favor of unionizing large components of the franchise industry and significant increases in the minimum wage.

Living an hour from New York City I've observed the influence and power of the S.E.I.U., when it's taken or supported various political positions. This includes assembling union members to descend on certain McDonald's in an attempt to disrupt operations under the guise of the picketers being fast food workers. The ultimate goal of the S.E.I.U. is to create an easier process for unionizing franchise employees and a joint employer designation could facilitate that effort.

I don't propose to have all of the answers for how franchisors and franchisees can unite over some common issues. However, history has shown us examples of countries, people and organizations with significant differences finding a way to unite over a common cause. Representatives of franchisor and franchisee organizations should find a way to join efforts against joint employer designation and unreasonable increases in local minimum wages.

2015 FranchiseKnowHow, LLC

Ed Teixeira is the President of FranchiseKnowHow.com and Chief Operating Officer, FranchiseGrade.com. He is a former franchise executive and franchisee. He can be contacted at 631-246-5782 or at  franchiseknowhow@gmail.com



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