States Lead the Charge Against Joint Employer Overreach

The National Labor Relations Board’s (NLRB) August 2015 ruling in Browning Ferris Industries completely upended the standard definition of “joint employer,” throwing thousands of business arrangements into limbo.  In doing so, the NLRB ignored legal precedent and can now hold franchisors liable with their franchisees for labor violations.  Despite this sweeping federal regulation, a plethora of state legislatures are defying the NLRB and passing legislation that preempts the new “joint employer” standard, opting instead for the traditional definition that franchisors and franchisees are separate entities.

A recent Bloomberg BNA article highlighted the role that IFA, along with other business oriented groups, has had on facilitating this proactive franchise legislation across the US.  “We are actively pursuing this legislation this year and have a strategy to continue pursuing this legislation in as many states as we can going forward,” said Jeff Hanscom, IFA director of State Government Relations. The IFA has successfully passed bills in Michigan, Louisiana, Tennessee and Texas, while legislation is moving in Colorado, Georgia, Indiana, Utah, Virginia, and Wisconsin.

Michigan is the most recent state to codify the franchisor-franchisee relationship, and bill sponsor Rep. Eric Leuthesuer (R) explained why he chose to take action on this issue: “What you are seeing in the states is legislatures looking at things that probably never needed to be addressed in statute because they were largely considered settled, common sense or intuitive for a long time. And now, because of court rulings, a lot of things that were common sense are now being thrown into some confusion, or potential confusion, or potential chaos. That’s not good for anybody.”

Through the Coalition to Save Local Businesses, the IFA continues to pressure Congress to act on the “joint employer” issue and provide a remedy for small business owners in America.  Judging by the success the IFA has had in state governments, it is clear that these legislators see the negative consequences impacting business owners in their districts, and states continue to lead the way.

As business groups such as the IFA, the U.S. Chamber of Commerce and The Business Roundtable

As business groups such as the IFA, the U.S. Chamber of Commerce and The Business Roundtable announced their support for efforts to raise the debt ceiling in order to ensure the economic certainty of the nation for America’s job creators and franchise small businesses, Jim Amos, the CEO of Tasti D-Lite spoke to MSNBC’s Chris Jansing this morning, moments before President Obama addressed the nation and called on lawmakers to find a bipartisan solution.

Asked by Jansing for his perspective about the impact a government default would have, not only on a big business, but also from the perspective of those small business owners who own Tasti D-Lite franchises, Amos called on the government to do everything it can, while also calling for a renewed focus on limited government, for the private sector to thrive. 

“If you are ideologically driven on the view that the public sector and government can solve these issues, then you’re going to make a certain set of decisions. If your view is that the private sector can participate, you will make a different set of decisions,” said Amos. “I think our country in the beginning was founded on principles that supported economic and political freedom or liberty. If you look at modern history, the greatest growth rates that we’ve had economically, they were driven by limited government.” 

The impact a government default would have on the ability of small business owners looking to expand, or prospective franchisees to obtain capital to purchase a franchise business, was also noted today by IFA President & CEO Steve Caldeira.

“Congress must raise the debt limit now to ensure the stability of our economy and prevent the credit markets from further volatility amidst an already difficult lending, public policy and regulatory environment for franchise small businesses,” said Caldeira. “If Congress allows a default on the obligations of the United States, it will have a dramatically negative impact on our economy and on the confidence of America’s small business owners and job creators.”

Posted by Matt Haller, IFA Director of Communications

 

Want to Eliminate Needless Paperwork? Urge Your Rep. to Repeal 1099s

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This week, the U.S. House of Representatives is going to tackle the much-despised tax provision written into the health care law, the 1099 IRS reporting requirement. To review, tucked away in the massive new health care law is a change to IRS rules that would require businesses to report all transactions that involve property or services which add up to more than $600 in a year per vendor, even when making purchases from a corporation. This would trigger the requirement to file a Form 1099 with the IRS and furnish taxpayer identification numbers (TINs) for the businesses and persons involved. The IFA is asking all its members to take two minutes to send a quick email to their Representative urging repeal of this burdensome legislation. Visit our easy advocacy center to make your voice heard. Thanks for your help!

Posted by Meredith Nethercutt, IFA Director of Advocacy

Benchmark your franchise system

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What’s new?  How about benchmarking best performance KPIs with other IFA members?  If you missed the “Benchmarking Made Easy” session at IFA’s 51st Annual Convention, you can still get “OnTrack” with IFA’s new, FREE, web-based benchmarking service. Visit the OnTrack page at Franchise.org to sign-up and learn more. 

Missed the session on OnTrack and want to order the session DVD? Visit IFA’s online store to purchase a copy.

IFA partnered with Dynamic Benchmarking to develop the service. 

Posted by John Reynolds, President, IFA Educational Foundation

Do you already miss being at IFA’s 51st Annual Convention? Just because the convention is over, d

Do you already miss being at IFA’s 51st Annual Convention? Just because the convention is over, doesn’t mean the memories can’t live on. Take a few minutes to watch the extended highlight reel of this year’s show. It is sure to help you relive some of the best moments from Las Vegas and share with your colleagues who weren’t able to make it! Enjoy…

Posted by Matt Haller, IFA Director of Communications