Legal news that affect small businesses and franchises, or legal advice for franchise owners

Motel 6 Settles Class Action for $7.6M over Claims It Shared Latino Names with ICE Agents

Motel 6 has agreed to pay $7.6 million to settle a class-action lawsuit that alleged the national hotel chain supplied immigration agents with personal data of guests who had Latino-sounding names, with some cases resulting in arrests and deportations.

FBI Granted More Time in Indictment of Franchisee Who Plotted Wife's Demise

A startling criminal case brought by the FBI last June against a multi-unit franchisee has now received federal court approval to delay its case for another month. Agents charged the financially troubled restaurateur with conspiring to kill his estranged wife, framing her as a terrorist, and plotting to commit arson on one of his restaurants to collect insurance money.

The Planet Fitness Transgender Case Is Headed Back to Trial Court

After three-plus years of legal wrangling, resulting in four court decisions, an ejected Planet Fitness club member in Michigan scored a victory over the franchise chain’s unwritten membership policy that allows biological men who identify as women to use the women’s locker rooms, showers and restrooms.

NLRB Chairman Proposes Overhaul of Current Joint Employer Standard

Following the National Labor Relations Board administrative judge’s recent decision to reject McDonald’s proposed settlement to resolve all cases that called it a joint employer with its franchisees on labor law violations, the NLRB announced Thursday that it will overhaul the current joint-employer definition.  

Negotiating Your Franchise Agreement or Letter of Intent

Although franchise agreements are often not negotiable, there are times when it's possible, according to this article. It offers guidelines on what those circumstances might be and what to look for.

One critical way to engage in smart growth, for both new comers to the industry and for more experienced players looking to build out their portfolios, is to pay close attention to the terms of your typically long-term franchise agreements.

...A few key provisions of the franchise agreement that can and should be negotiated include:

NLRB Proposes New Rule to Revert Franchisor Liabilities to Franchisees

A 60-day public comment period on a proposed NLRB rule affecting whether or not franchisors and franchisees have a joint employer relationship begins today. The five-member National Labor Relations Board, with the majority appointed by President Trump, has started the ball rolling on taking the joint employer liability relationship between companies and their contractors back to an earlier standard which was more franchisor friendly.

NLRB Rejects McDonald's Settlement Deal in Joint Employer Case

The National Labor Relations Board rejected a proposed settlement with McDonald's and fast food workers in regard to McDonald's wanting to avoid being considered a “joint employer” with its franchisees for their alleged labor law violations. UPDATE: REQUEST TO APPEAL

8 Franchisors Halt ‘No-Poach’ Hiring Policy

A report last year by two Princeton economists, stating that no-poach clauses could lock workers into low-wage jobs, caught the attention of the Washington State attorney general. Now Applebee’s, Church’s Chicken, Five Guys, IHOP, Jamba Juice, Little Caesars, Panera Bread and Sonic have just concluded agreements with his office to cease the previously widespread practice—not just in the state, but nationwide. Earlier in the year Arby's, Carl's Jr. and McDonald's made their own agreements with the Washington state AG to drop their no-poach clauses, also nationwide.