As reported by attendee Bob Spoerl
We are local. We are independent. We are small business owners.
Those were the common themes heard at the International Franchise Association’s Franchise Action Network (FAN) annual meeting Sept. 28 – 30 in Washington, D.C.
Thousands of franchisors, franchisees and suppliers met to address some of the most important political issues affecting the franchise community. Most pressing is the joint employer bill, or the “Protecting Local Business Opportunity Act,” which aims to invalidate a recent National Labor Relations Board (NLRB) ruling to essentially redefine the definition of joint employer.
THE FUTURE OF FRANCHISING
Many in the franchise community are concerned that the entire franchise model is under attack by one recent ruling.
In August, the NLRB had ruled that a franchisor can be designated as a “joint employer” of its franchisees’ employees, which would make it liable for its franchisees’ labor practices. The big concern within the franchise community is that the ruling overlooks decades of legal precedent and adopts a far broader definition of joint employer. Of utmost concern is that the ruling will “irreparably harm the franchise model of business,” according to the FAN.
After 300 meetings with members of Congress along with a press conference and Congressional hearing on the joint employer bill, the franchise community went away feeling as if they had made their case to legislators.
HEARING FROM FRANCHISEES
The IFA’s video recapping the event does a nice job of weaving together the annual meeting. In it, we hear from several concerned franchise business owners addressing why they came to Washington to lobby.
“It’s important for us to be here in person because I think when you take someone’s time and you’re looking at them face to face, we’re not just a letter or an email,” said Bob Smith, a ServiceMaster business owner.
Another franchisee, a multi-unit fast food owner-operator, summed up the concerns over the joint employer bill like this: He said he would have never considered opening a franchise business 30 years ago had the new “ joint employer” definition been in place. Over the years, he’s hired hundreds of people and brought business to dozens of communities.
HEALTH CARE LAW CONCERNS, LENDING RESTRICTIONS
While the joint employer bill took center stage, several other important issues came to light at the conference.
The Affordable Care Act (ACA) – something that has been of concern to the franchise industry for several years now – also received air time during the meeting. Specifically, the FAN is lobbying to redefine “full-time” within the ACA to be a more traditional 40 hours. Currently, employers with at least 50 full-time equivalent employees must offer affordable health coverage to employees and dependents or face a tax penalty. As it stands, the health care law defines “full-time” as anyone working 30 or more hours.
Also, two bills introduced in the House came under fire. According to the FAN, one of the bills imposes more restrictions on the franchisee-franchisor relationship, while the other “hampers franchisees’ ability to obtain SBA guaranteed loans through cumbersome and expensive additional financial disclosure and paperwork.”