Franchise owners are under attack
The California Legislature is seemingly hellbent on kneecapping fast-food restaurants in the Golden State.
This past week, the Assembly advanced Assembly Bill 1228, introduced by Asm. Chris Holden, D-Pasadena, which threatens to undermine the franchise model in California.
According to the bill analysis, the proposal requires “a fast food restaurant franchisor to share with its fast food restaurant franchisee all civil legal responsibility and civil liability for the franchisee’s violations of prescribed laws and orders, or their implementing rules or regulations.”
Business groups, led by the California Chamber of Commerce, warns that this bill would undercut the independence of franchisees and compel franchisors to exercise more control over the operations of the franchisees.
“With establishment of joint liability of franchisors by [this bill], California is making a per se determination that franchisors are the joint employers of franchisees,” they warned. “In doing so, California is also making a per se determination that these owners and entrepreneurs are not small business owners, but middle managers of large corporations.”
The coalition against the bill, which includes the California Hawaii NAACP and the Latino Restaurant Association, further warns that, “AB 1228 would create a whole new class of lawsuits that would make it easier for trial lawyers to sue both the local fast-food restaurant and the national restaurant corporation.”
Which, of course, is clearly one of the goals of the bill.
The unions backing the bill are unhappy that the business community has successfully halted implementation of legislation that would create a state fast food council that can meddle in the operations of fast food restaurants.
It must be noted that many moderate Democrats withheld their votes for the bill, which only barely passed. Southern California Democrat James Ramos of San Bernardino County notably voted against the bill, as did Jasmeet Baines of Bakersfield. They deserve credit for standing up for small business owners and against terrible legislation.
Assembly Bill 1228 must be defeated in the California Senate.
Here’s to hoping common sense prevails.