The National Labor Relations Board took another step toward eliminating the franchise business model on Friday, opening the doors for unionization at some of America’s largest employers.
The agency’s top prosecutor, former union attorney Richard Griffin, is holding McDonalds responsible for alleged labor violations perpetrated by its franchisees, overturning decades of precedent.
“The complaints allege that McDonald’s USA, LLC and certain franchisees violated the rights of employees working at McDonald’s restaurants at various locations around the country by, among other things, making statements and taking actions against them for engaging in activities aimed at improving their wages and working conditions, including participating in nationwide fast food worker protests about their terms and conditions of employment during the past two years,” the agency said in a release.
Franchisors such as McDonald’s charge employers fees to operate under its corporate umbrella, but individual entrepreneurs manage business decisions, such as scheduling and pay, individually. Holding McDonalds liable for the actions of other actors threatens to undo the entire business model, according to Robert Cresanti, vice president of the International Franchising Association.
“Put yourself in the shoes of a small business person who has just invested their life savings in a new franchise,”Cresanti said. “Now they no longer own their business as a group of unelected government bureaucrats have just jeopardized whether they control their employees or not.”
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