Assemblyman Chris R. Holden. (Photo: Kevin Sanders for California Globe)
AB 1228: Joint Employer Liability for Fast Food Restaurant Franchisors and Franchisees
Franchisors must take greater responsibility for achieving compliance with employer laws throughout their franchise networks
By Chris Micheli, February 26, 2023 12:20 pm
Assembly Bill 1228 (Holden) was introduced to impose joint employer liability for fast food restaurant franchisors and franchisees. AB 1228 would add Labor Code Section 2810.9.
Section 1 of the bill would name the Fast Food Franchisor Responsibility Act.
Section 2 of the bill would provide five legislative findings and declarations that the fast food restaurant industry has long been rampant with employment law violations, and that the franchise model under which those fast food restaurants are operated contributes to the high rate of employment violations.
In addition, despite their contributions to the problem, fast food restaurant franchisors often avoid liability, and disavow any responsibility, for the employment violations affecting the fast food restaurant workers in their franchised stores. Finally, franchisors must take greater responsibility for achieving compliance with employer laws throughout their franchise networks.
Section 3 of the bill would add Labor Code Section 2810.9 to provide that a fast food restaurant franchisor is required to share with its fast food restaurant franchisee all civil legal responsibility and civil liability for the fast food restaurant franchisee’s violations of specified laws, as well as orders issued by the Governor, a county, or a municipality regarding employment standards, worker health and safety, or public health and safety.
In addition, the laws, orders, rules, and regulations specified may be enforced against a fast food restaurant franchisor, including administratively or by civil action, to the same extent that they may be enforced against the fast food restaurant franchisor’s franchisee. However, a civil action cannot be commenced against a fast food restaurant franchisor under this section prior to 30 days (which can be extended to 60 days upon written request) after written notice of the alleged violation of any of the laws and orders has been given to the fast food restaurant franchisor by a person commencing the action.
A fast food restaurant franchisor would not be liable in a civil action if the fast food restaurant franchisor cures the alleged violation within the applicable time period (30 days or 60 days). A waiver of this section, or any agreement by a fast food restaurant franchisee to indemnify its fast food restaurant franchisor for liability under this section, would be contrary to public policy and would be void and unenforceable.
If the terms of a fast food restaurant franchise prevent or create a substantial barrier to a fast food restaurant franchisee’s compliance with the laws and orders specified the fast food restaurant franchisee may file an action against its fast food restaurant franchisor for monetary or injunctive relief necessary to ensure compliance.
Moreover, there would be a rebuttable presumption that any changes in the terms of a franchise that increase the costs of the franchise to the fast food restaurant franchisee create a substantial barrier to compliance with the laws and orders specified. Finally, the following terms would be defined: “fast food chain,” “fast food restaurant,” “fast food restaurant franchisee,” “fast food restaurant franchisor,” “franchise,” “franchisee,” and “franchisor.”
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September 2, 2022 -
Democrat Assemblyman Chris Holden, a professional politician who flits from one political office to another and who has never run a business, is now pushing a bill that would make fast food restaurant franchisors responsible for the civil legal and liabilities of their fast-food restaurant franchisee’s violations of specified laws, as well as orders issued by the Governor, a county, or a municipality regarding employment standards, worker health and safety, or public health and safety. Since illegal aliens make up a large percentage of the fast-food industry workforce, does Holden’s Assembly Bill 1228 make fast food restaurant franchisors responsible for fast food restaurant franchisees who hire illegal aliens in violation of 8 U.S. Code § 1324a – Unlawful employment of aliens? Not likely since California Democrats routinely defy federal immigration and employment laws?
Hey, Asm Chris Holden, “Wannabe Wrecking Ball for CA Small Business,” why not wait to see if your previously ruinous law, AB 257 (now on hold), passes muster with the voters in Nov. 2024 after being challenged by a fast food coalition, before proposing more legislation (AB 1228) that seeks to slow-bleed small business franchisees in addition to their chain restaurant franchisors? One destructive bill at a time seems a bit more fair, don’t you think?
https://californiaglobe.com/articles/restaurant-groups-submit-over-1-million-signatures-for-fast-food-labor-referendum/
Apparently many of our Dem legislators are HOT on the unionizing-all-workers-by-force trail right now because fewer and fewer workers are choosing to join unions. “Looks like we’ll have to force the issue then,” say those Dem/Marxist legislators. Guess whose campaigns appear to be well-funded by the CA labor unions?
“Why California’s Fast Food is Getting More Expensive” – California Insider interviews Hank Adler
https://www.youtube.com/watch?v=ilDFAnNuRQE
This video deserves another look (30 mins). Guest Hank Adler points out that legislation like this will not only very negatively affect the fast food industry but will set a precedent for all small business in the state.
Just what California needs right now. Not!
Democrats are just mad that their attempt to force unionization of all fast food workers has been blocked in the courts and will most likely be overturned by voters at the ballot box in 2024. So instead they are going to try again by forcing some of the rules they were seeking via separate laws. Franchises are each their own separate business entities. Franchisors have no involvement in the day to day operations of a franchisee. Nor should they. If this law passes, you can kiss goodbye to a large chunk of the fast food industry in the state along with the thousands of jobs they provide. Although, good chance this law would likewise get challenged in the courts and repealed by voters once they realize it will hamper their ability to get a quick burger or taco.
If the purported rationale for this bill is that this segment of food service is rampant with employee law violations, and the suggested remedy is to add the franchisor to the liability for said violations, why is this solution preferred over the option addressing employee law violations with individual franchisees? If the current model to address such violations with individual franchisees is too difficult (one supposes due to the inconvenience of the sheer number of franchises), why not simply eliminate all franchises? Surely, preventing violations must take precedence over the existence of small business opportunities. Problem solved! You’re welcome!
Only one question to ask. Why Franchised restaurants? Why not all restaurants? When laws are past covering a certain segment of a market, it is usually because of lobbyist impact (special interest groups). This bill establishes rules for your franchised business that your non franchise competitor does not have to follow? How can that be and who would want it? Not any small business owners, that’s for sure.
THIS IS AMERICA YOU DO NOT HAVE TO EAT FAST FOOD, YOU COULD STAY OFF THE CELL PHONE AND COOK DINNER FOR YOUR FAMILY! IF THERE IS PROTECTION FOR THE AVERAGE HUMAN BEING THEN PEOPLE LOSE THEIR MINDS!! BIG BUSINESS GET ALL THE BREAKS AND AMERICA CALLS ITSELF A CHRISTIAN NATION, BUT TURN THEIR BACKS ON HELPING PEOPLE OUT BY NOT PROVIDING A LIVING WAGE. WHEN I WAS GROWING UP THE FAST FOOD JOBS WERE FOR FIRST TIME EMPLOYEES, TEENAGERS, NOT FOR ADULTS TO MAKE A LIVING, BUT NOW THAT TIMES HAVE CHANGED WE MUST ADJUST SO THAT PEOPLE CAN LIVE!! HAVE A HEART AMERIKKKA
This website claims to be unbiased as does Katy Grimes, the editor, yet 3 minutes of internet research demonstrates the conservative bias of both. That’s OK. However, claiming to be unbiased and nonpartisan is an outright lie and utterly undermines the reporting, much of which is biased and not straightforward. What is it with conservatives? Why can’t you just be honest?