IFA Addresses Threats to the Franchise Model at MUFSO

On Oct. 7, the 55th annual Multi-Unit Foodservice Operators Conference, better known as MUFSO, concluded in Dallas. MUFSO is the most comprehensive executive conference in the restaurant industry and IFA sponsored a session titled, “Franchising Under Attack: Get Informed & Learn How to Take Action!”

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The session provided an overview from industry leaders and legal perspectives on all the franchise legislative and policy issues facing the industry. It also explained how to get involved through the recently launched IFA Franchise Action Network (FAN).

Panelists included Patrick Doyle, president & CEO, Domino’s Pizza Inc.; Aziz Hashim, president/CEO, NRD Holdings, CEO/chairman, Impact Investments; Michael Lotito, co-chair and shareholder, Littler’s Workplace Policy Institute; Steve  Romaniello,  CFE, managing director, Roark Capital; and Matt Haller, senior vice president, media relations & public affairs, IFA, who served as moderator.

The session got underway with Hashim, Doyle and Romaniello echoing points on the state of the industry under attack. Hashim noted he has “never seen this kind of wave,” regarding the industry threats with Romaniello adding, “Make no mistake, the industry is under attack and it is broader and deeper than most people think.” Doyle was hopeful “that rational people will make rational decisions, but a lot is at risk right now for the industry that could impact millions of business owners and jobs.”

Haller guided the conversation next to last week’s veto by Governor Jerry Brown of harmful franchise relationship legislation in California. The veto of SB 610 represented a true victory for franchise small business owners and employees throughout the state, the culmination of a two-year strategic campaign by IFA and California FANs.  “The reason people choose to be franchisees are brand promise and operations, franchising success rate is higher.  Legislation like this would weaken brand consistency which would lead to more failures,” Doyle commented.

Hashim added that SB 610 would have been, “government interfering in business contracts and have unintended consequences,” noting that, “special interest is at play trying to cause a rift between franchisees and franchisors.” Romaniello spoke to the energy surrounding the IFA opposition campaign:  “we have made a greater effort to engage franchisees, there are more common interests than ever before, and also a common enemy,” and continuing that “the Franchise Action Network is a tool to engage on a more granular and local level, as state and local issues are now a focus to be pro-active on, and California is a great example.” Lotito gave the opposition perspective on what SEIU is spending on this fight, how well its messaging is organized and the real challenge in this debate.

The next issue of discussion was the National Labor Relations Board recent ruling on joint employer. Lotito walked the group through the full impact of the proposed joint employer standard and what it means for the industry. Hashim noted that the ruling “profoundly changes the franchise model. Worst case, everything becomes corporate-only stores, which threatens the basic foundation of franchising. Franchisees are independent entities that hire, fire, promote and set wages.”

The panel closed with a call to action from all the panelists that there is no choice but working together to protect the industry and engaging lawmakers with the franchise business community.

For more information about the Franchise Action Network or to sign up, please visit www.FranchiseActionNetwork.com.

For any questions or inquiries, please contact Erica Farage at 202-662-0760 or efarage@franchise.org.

Franchising World’s Legal Update at a Glance

Franchise business executives, franchisees and franchise suppliers must always be keenly aware of the pulse of the industry.  The March issue of Franchising World presents leading industry executives who will guide you through some of the issues facing a “Regulation Nation.”

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This month’s authors walk you through the maze of compliance issues, enforcement standards, data breaches, financial performance representation, state legislative activities in Massachusetts and getting franchisees financed.  So not only will you gauge the pulse of the industry, but a quick click on your mobile device will help you prepare for the some of the challenges facing you in the regulatory forefront.

IFA Pres. & CEO Steve Caldeira, CFE, explains in this month’s column the significance of IFA members’ participation as grassroots advocates.  He advises that “legislators are very interested in hearing from our members, whose personal experiences and insight make them the ultimate authority on the challenges facing the industry.”

In the coming days, follow franchisingworld.com for more articles from the March magazine that will build on your expertise in management and operations, multi-unit franchising and trends affecting the franchise industry.

CKE Restaurants’ Puzder advocates for immigration reform in Washington

 

 

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As the immigration debate continues on Capitol Hill and across the country, ImmigrationWorks, a national organization advancing immigration reform that works for all Americans, held an event in Washington D.C. today at the American Enterprise Institute to help lawmakers and voters understand the most important elements for creating a better legal system for the future.

Andrew Puzder, CEO of CKE Restaurants, provided insights on how the immigration reform bill would affect American businesses and the consequences of not addressing key issues in the debate.  With 3,300 restaurants throughout 48 states and approximately 70,000 workers employed by Carl’s Jr. and Hardees Restaurants, Puzder believes a bill like the one before Congress would spur economic growth and advance consumption.

“A rational, enforceable and practical immigration policy is something that would reinforce the idea that the U.S. is the land of opportunity,” said Puzder.

What American businesses like Puzder’s really need is the comfort that a person his restaurants have hired is here legally and that the system for legalization is easier for those involved to understand.

“E-verify has been very helpful for businesses who really want to comply with the law,” explained Puzder.  “If we had reform and were able to hire people without concern, we would have a better and more diverse workforce in this country.”

According to Puzder, the most important thing is economic growth and businesses have been fighting to survive since 2008.  “A bill like the one before Congress could really be a benefit to the U.S. economy and it would be nice to participate in an economy that was constantly growing,” he said.

 

 

IRS issues employer mandate details

IRS issues employer mandate guidance (REUTERS)

IRS issues employer mandate guidance (REUTERS)

The IRS yesterday (December 28, 2012) issued a Notice of Proposed Rulemaking on the employer requirements under the Affordable Care Act (Internal Revenue Code §4980H), many of which will take effect on January 1, 2014.

The mandate will require “applicable large employers” to either offer full-time employees (and their dependents) an “affordable” health benefits package that meets a “minimum value” standard, or face possible penalties. Applicable large employers are defined as employers with 50 or more full-time-equivalent employees. IFA is reviewing the extensive 144 page rule, which was accompanied by a Q&A document, and will have a full analysis soon. The full rule is available here.

Also, IFA is offering franchise system webinars for IFA members interested in learning about the details of the law’s requirements, penalties and other implications for franchise businesses. To request a webinar, please email Kevin Serafino (kserafino@franchise.org).

In yesterday’s rule, the proposed regulations put forth are organized as follows:

· Definitions

· Rules for determining status as an applicable large employer and applicable large employer member

· Rules for determining full-time employees

· Rules for determining assessable tax payments under IRC §4980H(a)

· Rules for determining whether an employer is subject to assessable tax payments under section IRC §4980H(b)

· Rules relating to the administration and assessment of assessable tax payments under IRC §4980H

· Rules relating to transition relief in certain circumstances

The notice of proposed rulemaking is scheduled for publication in the January 2, 2013, Federal Register, and comments are due by March 18, 2013. In addition, the IRS announced a public hearing on the notice of proposed rulemaking for April 23, 2013, at 10 am. IFA will be submitting formal comments building upon the extensive comments already submitting regarding the law.

In Case You Missed It: What You Need to Know About Social Media & the NLRA – PAC 2012 #FranchiseJobs

In the increasingly digital world we live in, businesses must adapt to changing technologies and institute workforce policies that effectively manage how such technologies can be used in the workplace. There is a fine line between establishing company policies regarding social media use and infringing on the individual rights of employees according to the National Labor Relations Act (NLRA). To help franchise owners understand this fine line and how to better navigate it, Michael Pires from Public Affairs Conference sponsor ADP, Inc. spoke on how to develop a social media policy that protects one’s business as much as possible while respecting all the established rights of their employees.

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