Don’t know what you’ve got ’til it’s gone

What is a franchisee, employee or independent contractor?

The Coverall decision has franchisors running scared all over North America (Coverall Ruling Sends Shiver through Franchising)

Any publicly-traded company that is underperforming is a target for corporate takeover. That’s a natural thing.  Companies get bought and sold every day.

But because of Coverall,  any potential takeover specialist would heavily discount the target’s stock value if their “franchisees” were really misclassified “employees”.

To protect their sorry, loser asses the current management team would want to re-convert all franchisees to employees as a way to prop up their pathetic share price.

Not great news for disorganized, current franchisees.

Welcome to new world of:

  1. no franchise,
  2. no job (try servicing your, maybe $200,000 of debt),
  3. or a minimum wage job (same debt).

Ignorance costs.

One Response to Don’t know what you’ve got ’til it’s gone

  1. Carol Cross says:

    At least the noise the janitorial franchises are creating will perhaps bring attention to the fact that “franchising” as a way of doing business provides the means for franchisors to reap all of the rewards and profits of employers while evading and avoiding the expense and legal obligation of employers under law. But, who picks up the tab for the franchisors free ride? The state, of course. At least the courts may have to look at this situation with open eyes.

    Because franchisors use the current laws surrounding “independent contractors” and remove the rights of the franchisee independent contractor with adhesive take-it-or-leave it contracts, they are free under current law to screw their so called independent contractor franchisees to reward their stock holders?

    Obviously, franchising, the hybrid business model, is protected by Wall Street and the street’s influence on business law. As has been demonstrated, franchisees can’t win under any circumstances if a win for franchisees means that the franchisor’s system or commercial paper would be adversely impacted. It is the nature of “the beast of franchising” that franchisees be sacrificed to the appetite of the beast.


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