Joint Employer Liability and the Implications for Franchisors and Licensors

Franchisors and licensors are confronting a concerted effort by the U.S. Department of Labor, the National Labor Relations Board and some state attorneys general to thrust direct liability upon them — as putative "joint employers" — for their franchisees' and licensees' wage-and-hour and labor law violations.

With the strong support of unions seeking the ability to collectively bargain the wages of franchisee and licensee employees with the subject franchisors and licensors (instead of with the direct franchisee and licensee employers), and the strong endorsement of academics who view franchising and licensing merely as a means of "fissuring" the economy to the detriment of workers, these federal and state agencies have initiated investigations, administrative proceedings and court actions seeking to establish as law their rather radical normative desires (most notably, a pending NLRB case against McDonald's Corporation seeking to hold it liable for its franchisees' wage-and-hour, overtime and other purportedly violative conduct).

This program will examine how the politics of economic disparity triggered the aggressive government "joint employer" thrust; examines the forces and philosophies that gave rise to the "franchisor/licensor as joint employer" theory; examines how the government is deploying that theory against franchisors and licensors; and will examine how the Lanham Trademark Act and all federal and state franchise laws (along with virtually every judicial decision addressing the subject) actually refute the position that a franchisor or licensor is the joint employer of its franchisees/licensees' employees.

Join David J. Kaufmann for a discussion of these issues. Mr. Kaufmann, a partner in New York City-based Kaufmann Gildin & Robbins LLP and Chair of that firm's Franchise and Distribution Group, represents many of our nation's largest and most reputable franchisors; authored the New York Franchise Act; serves as the New York Law Journal's franchise law columnist; is an advisor to the quasi-governmental body of our nation's federal and state franchise regulators (the NASAA Franchise Project Group); and authors the annual Practice Commentary on franchising for McKinney's New York Statutes. 

1. Analyze the genesis, evolution and current status of the "joint employer" doctrine
2. Address how the joint employer theory is being applied against franchisors
3. Identify those steps which franchisors and licensors must undertake to shield themselves from a governmental/judicial determination that they are joint employers